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Session Recap: Yen weakens on BoJ Shirakawa departure day

FXstreet.com (Barcelona) - The Asian session saw majors on a further consolidation transition as the the unrest in Cyprus forces traders to be expectant on the sidelines. Euro and US Dollar end the session in a technical tie, unchanged at 1.2955.

While Cyprus and the Eurozone agreed to soften the tax levy on small depositors below 100k late Monday, there is still conflicting reports where the remaining bailout fund would come from, with some media outlets reporting that uninsured 100k+ account holders may have to pay well above 10% tax. There is also little clarity as to when the tax levy vote will take place.

In Australia, the RBA minutes was a non-event, after the central bank informed that the accommodative policy remains appropriate for now. AUD/USD fluctuated in a 30 pips range, although 1.04 proved too heavy. The worst performing currency was the Japanese Yen, the same day that BoJ outgoing governor Shirakawa officially stepped down, passing now the reins to the new governor Mr. Kuroda, with rumours of earlier-than-anticipated easing action still making the rounds.

In the stock market, shares were up after the Cyprus-inspired falls from Monday. Shanghai stands marginally higher at +0.23%, the Nikkei 225 is almost 2% higher, while the Honk Kong's Hang Seng Index follows Shangai performance by rising more moderately a 0.3%.

Main headlines in Asia

- Cyprus meeting: More flexibility on levy with Tuesday vote uncertain

- EUR/USD, 1.2965/75 intra-day supply protects upside

- Deposit tax may exempt Cypriot savers under €20,000

- Japan economy minister Amari: Shirakawa was a little cautious as BOJ Governor

- RBA minutes shows neutral stance: accommodative policy appropriate

- We may be entering a new era for the AUD - HSBC

- China Feb FDI - Foreign Direct Investment (YTD)(YoY) improves to -1.35% vs -7.3%

- Bloomberg article: China’s Foreign Investment Gains for First Time in Nine Months

- Anastasiades warned Merkel on no parliamentary majority

- AUD/USD: Local hedge fund sells above 1.0390

- EUR/USD continues limited by 1.2965/75 supply

- AUD/USD reverses on Rio Tinto's comments

- USD/JPY : Pushing higher with Japanese equities

Japan Jan Coincident Index decreases to 91.6 vs 91.9

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Euro buying interest fades ahead of 1.30

It may seem as though the EUR/USD over reacted after selling off from previous weekly highs on Friday following news on Cyprus bail out details, which led the pair to massively gap lower from above the 1.3070 level to fresh 3-month lows at 1.2880 yesterday. However, the reality is that the pair continues well capped so far below 1.30.
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