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Forex pairs in this Article » USD/JPY (London) - The yen has continued to slide today as markets remain in risk-on mode following Janet Yellen’s dovish testimony yesterday before the US senate committee on Banking, Housing, and Urban Affairs. Yellen was speaking ahead of her appointment as Ben Bernanke’s replacement as the chairman of the Federal Reserve.

USD/JPY is up 0.25 percent on the day to USD100.3550, breaking above the psychologically important JPY100 level during Yellen’s testimony as the prospect of continued Fed activism dampened safe haven demand for the yen.

Yellen reassured markets that the Fed would be slow to taper its USD85bn-a-month asset purchase programme with couched language. Responding to questions from the senate following her pre-released speech, Yellen stated that: “It’s important not to remove support, especially when the recovery is fragile and the tools available to monetary policy, should the economy falter, are limited given that short-term interest rates are at zero.”

Yellen’s implied risk support has helped equity market to soar. The Nikkei rose 1.95 percent and the Hand Seng 1.69 percent over the asian session, while the Ftse is up 0.44 percent.
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