At the beginning of April the Bank of Japan held its first policy meeting with stimulus-advocate Haruhiko Kuroda as Governor. The central bank’s decision to double its monthly bond purchases triggered widespread declines in the Yen, but after the BOJ met for a second time this month the Yen strengthened against the majority of its rivals.
The Japanese Yen exchange rate was in the region of 98.5700 Yen to one US Dollar as of 09:55 am GMT
The Bank of Japan announced its decision to continue with its unprecedented stimulus programme, but unveiled no new measures for tackling Japan’s persistent inflation.
Some industry experts had hoped that the central bank would hint at something more, potentially pushing the Yen to 100 Yen per Dollar. When the BOJ failed to deliver, and with Japanese markets due to close for a three-day holiday, the Yen strengthened to 98.66 against its US counterpart.
As foreign-exchange strategist Daisaku Ueno states: ‘Today’s statement was so terse, compared with the April 4th monetary-easing bomb. Traders who’d hoped to push the Dollar-Yen rate to the 100 mark seem to be giving up ahead of the three-day holiday, resulting in selling of the pair.’
The BOJ’s statement was a sparse two sentences, saying only that the central bank ‘will conduct money-market operations so that the monetary base will increase at an annual pace of about 60-70 trillion Yen.’
Before the announcement, data showed that Japan’s consumer prices (excluding fresh food) fell by the largest amount for nearly 2 years, slipping 0.5 per cent.
In a separate statement the BOJ revealed that it anticipates that core inflation, excluding sales tax effects, will stand at 1.4 per cent next year and 1.9 per cent in 2015.
The most significant cause of market volatility today is likely to be US GDP figures, scheduled for release at 13:30 GMT.
Current Japanese Yen (JPY) Exchange Rates
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The US Dollar/Japanese Yen Exchange Rate is currently in the region of: 98.5700 <
The Pound Sterling/Japanese Yen Exchange Rate is currently in the region of: 152.3100 <
The Euro/Japanese Yen Exchange Rate is currently in the region of: 128.5380 >
The New Zealand Dollar/Japanese Yen Exchange Rate is currently in the region of: 83.8879 >
The Australian Dollar/Japanese Yen Exchange Rate is currently in the region of: 101.5130 >
(Correct as if 09:55 am GMT)
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