The Bank of Japan’s optimistic outlook for the Japanese economy helped to push the Japanese Yen broadly higher. Earlier today, the BOJ announced that no changes were being made to its existing loose monetary policy. That satisfied investors who had expectations of more easing given the relative stagnancy of Japan’s economy and the shortfall of the BOJ’s inflation target of 2%. Nonetheless, analysts do believe that the BOJ will eventually be compelled to act again, perhaps later this month when it releases its long-term forecasts.
As reported at 11:59 am (BDT) in London, the USD/JPY was trading at 120.0200 Yen, down 0.20%. The EUR/JPY was 134.8640 Yen, a loss of 0.48%. Though analysts have expectations that the Yen will come under pressure as the October 30th meeting approaches, global uncertainty and the drive to safety could temper long-term declines.
Draghi Avoids “Shop Talk”
In the Eurozone, markets that had anticipated hearing at least a little rhetoric from Mario Draghi, the head of the ECB, were disappointed. Mr. Draghi made no mention of the Eurozone economy at all in his speech yesterday, which helped to keep the Euro contained and within its normal trading band. The EUR/USD is lower at $1.1236, down 0.29% following the release of German economic data which hinted at the prospect that the largest economy in the Eurozone may have lost ground during the third quarter.