empty
 
 

2013.03.2605:10:02UTC+00Yen weakens against counterparts as BOJ's Kuroda state easing alternatives

The yen losses its strength for the first time in four days versus the dollar after Kuroda announced the BOJ will consider stretching the maturities of bond purchases and scrapping a limit on such buying. The euro exchanged 0.2 percent from a four-month low ahead of debt auctions in Italy, where lawmakers are still attempting to form a government after inconclusive elections last month.

“The speculative community has driven dollar-yen higher,” Jonathan Cavenagh stated, a currency strategist in Singapore at Westpac Banking Corp. (WBC) For Kuroda “the bar is set quite high in terms of what he’s going to have to deliver to give dollar-yen a significant boost.”

The yen dropped 0.2 percent to 94.36 per dollar as of 11:22 a.m. in Tokyo from yesterday. It declined 0.3 percent to 121.42 per euro. The euro advanced 0.1 percent to $1.2868 from yesterday, when it reached $1.2839, the lowest since Nov. 22.

Kuroda told lawmakers today that he will explain the growing number of buys of long-term bonds to influence the so-called yield curve. The BOJ recently buys government bonds with maturities of up to three years through its 76 trillion-yen ($805 billion) asset-purchase program.

He also added he will talk about scrapping the so-called banknote rule of keeping central bank bond holdings at less than the worth of banknotes outstanding. It’s a fact that financial easing kicks down a currency, the BOJ chief stated.

Kuroda Declaration

Kuroda stated policy specifics will be tackled at the BOJ board meeting, scheduled for April 3-4.

The yen has backslid 17 percent in the past six months on assumptions for additional stimulus, the biggest drop among 10 developed-nation currencies. The U.S. dollar has acquired 2.5 percent, while the euro has advanced 2.4 percent.

Italy is scheduled to sell bills today and bonds due in 2018 and 2023 tomorrow. The euro zone’s fourth-biggest economy bid 2.8 billion euros ($3.6 billion) of 2014 zero-coupon bonds yesterday at a yield of 1.746 percent, the highest since Dec. 27.

Italy’s Democratic Party leader Pier Luigi Bersani has two days left to resolve a shortfall of support in parliament, after President Giorgio Napolitano gave him an order on March 22 to try to form an administration. Bersani will meet adversary Silvio Berlusconi’s deputies at the People of Liberty party today.

“With the political risk in Italy continuing, it will be hard for the euro to make any headway,” announced Yuki Sakasai, a foreign-exchange strategist at Barclays Plc in New York.

  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST
  • Chancy Deposit
    Deposit your account with $3,000 and get $8000 more!
    In March we raffle $8000 within the Chancy Deposit campaign!
    Get a chance to win by depositing $3,000 to a trading account. Having fulfilled this condition, you become a campaign participant.
    JOIN CONTEST
  • Trade Wise, Win Device
    Top up your account with at least $500, sign up for the contest, and get a chance to win mobile devices.
    JOIN CONTEST
  • 100% Bonus
    Your unique opportunity to get a 100% bonus on your deposit
    GET BONUS
  • 55% Bonus
    Apply for a 55% bonus on your every deposit
    GET BONUS
  • 30% Bonus
    Receive a 30% bonus every time you top up your account
    GET BONUS


Can't speak right now?
Ask your question in the chat.