The U.S. Dollar edged lower for the third consecutive day against the Japanese Yen as one member of the Japanese government reiterated its warning that the Japanese economy could be unduly harmed by the Yen’s continued weakness. As reported at 2:27 p.m. (JST) in Tokyo, the USD/JPY pair was trading at 88.20 Yen, a loss of 0.2% and well off Monday’s 2-year peak of 89.67 Yen. Markets players continue to believe that this rebound is merely a minute correction and expect that in the long run the Japanese government will push for the lower currency as a means of restoring the economy which has been struggling with deflation. At the Bank of Japan’s next policy setting meeting, analysts believe that an inflation target of 2%, double the current target will be set.
Also in Asia, the Australian Dollar lost nearly 0.7% against the greenback as unexpectedly poorer jobs data revived speculation that the Reserve Bank of Australia might consider an interest rate cut at next month’s rate setting meeting. At one point the AUD/USD pair was trading at a session low of $1.0496, but has since recovered and is trading currently at $1.0508.