Forex - EUR/JPY remains close to 10-year low after Trichet

Forex News – The euro remained lower against the yen on Thursday, trading close to a 10-year low after European Central Bank President Jean-Claude Trichet announced new measures to refinance European lenders and said the ECB will resume buying bank bonds.

EUR/JPY hit 101.69 during European afternoon trade, the daily low; the pair subsequently consolidated at 101.91, shedding 0.55%.

The pair was likely to find support at 100.74, Tuesday’s low and a more than 10-year low and resistance at 103.22, Monday’s high.

In his final press conference as president of the ECB, Trichet said the central bank will advance new loans to banks with maturities up to 13 months and ECB will resume covered-bond purchases, saying that the measures "will continue to ensure that euro-area banks are not constrained on the liquidity side."

Earlier in the day, the ECB left its interest rate unchanged at 1.5%.

But the euro remained under pressure as Trichet offered a gloomier assessment of the economy than in September.

"The economic outlook remains subject to particularly high uncertainty and intensified downside risks," Trichet said.

The euro was also lower against the U.S. dollar, with EUR/USD down 0.62% to hit 1.3265.

Also Thursday, the U.S. Department of Labor said initial jobless claims rose less-than-expected last week, increasing to a seasonally adjusted 401K, from an upwardly revised 395K the previous week.

Analysts had expected jobless claims to rise by 411K last week.