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Posted by Joseph Trevisani on Feb 7, 2013 4:41:00 PM

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The pair is likely to trade in a tight range, with investors seen attending to the euro after European Central Bank President Mario Draghi warned of risks stemming from a strong euro and weak economic growth.

At Thursday's press conference following the ECB rate announcement, Draghi said exchange rates "should reflect fundamentals," adding that "we certainly want to see whether the appreciation -- if sustained -- will alter our risk assessment as far as price stability is concerned."

The euro reached 1.3711 on February 1, the highest since November 2011, while hitting 127.71 againt the yen on February 6, the best level since April 2010 but before concerns about political turmoil in Italy and Spain emerged.

Investors will also focus on any developments in the nomination for the new Bank of Japan governor after incumbent Masaaki Shirakawa announced his intention of stepping down on March 19, together with his two deputies, ahead of the expiration of his term on April 8. Prime Minister Shinzo Abe is expected to present his candidate for the next BOJ governor to opposition parties after a visit to the U.S. this month. The rate moved from Y93.08 to Y93.92 on Thursday.




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