Ahead of the Bank of Japan’s monthly policy meeting, the Japanese Yen had once again been under pressure as investors speculate on the BOJ’s commitment to maintaining their existing, ultra loose policy. A recent poll of economists called for no change to policy and indeed, the central bank’s policy members decided unanimously to keep interest rates, inflation targets and asset purchases at existing levels for the near term. The BOJ policy statement stressed that the economic recovery continues to make good progress and will likely not be impeded by the imposition of a new sales tax in April of next year.
As reported at 10:58 a.m. (JST) in Tokyo, the USD/JPY had edged to a session high of 104.48 Yen, a gain of 0.1%, and moving closer to the 5-year peak hit earlier this week. The EUR/JPY was trading at 142.35 Yen, not too far from Wednesday’s peak of 142.89 Yen, a 5-year high.
U.S. Dollar’s Revival
The U.S. Dollar is still being lifted by the Federal Reserve’s recent announcement of the curtailment of its QE program; that has helped to lift short-term U.S. treasury yields and given the greenback and broad a solid lift. As a result, the EUR/USD was under pressure and was trading at $1.3655, a loss of 0.1% and the lowest price in nearly two weeks. Commodity-linked currencies were also on the backfoot with the AUD/USD pair dropping to a 3-year low at $0.8820 before edging back to $0.8856, still however a los of about 0.1%.