22 Jan 2014
USD/JPY little changed on the session after BoJ decision
FXstreet.com (London) - USD/JPY is little moved on the session so far, with any price moves retraced following the Bank of Japan's decision to rates at 0.1 percent as well as maintain current easing levels.
BoJ holds easing levels pending April sales tax hike
The central bank also moved to hold easing measures at their current levels, maintaining its JPY70 trillion expansion of its monetary base. With inflation accelerating towards the BoJ’s 2 percent target, it is likely that it will wait until after the sales tax increase kicks in on 1 April before it decides whether to expand its easing programme.
“Prices have been moving in line with our forecast,” said Governor Haruhiko Kuroda in the press conference following the rate announcement. “If upside or downside risks don’t materialize, we’ll continue with current policy.”
BoJ announcement in line with expectations
The BoJ announcement came in as expected, with little to push USD/JPY higher. The pair has been driven by the diverging monetary policy expectations between the BoJ and the US Federal Reserve. While the BoJ has stated that it is prepared to increase its bond purchases if deflationary pressures warrant, the Fed is anticipated to be on a cycle of tapering its monthly asset purchases.
Any challenges to the three-and-a-half-year high at JPY105.4415 posted at the beginning of the month may have to wait until the Fed’s FOMC meeting on 28-29 January and the subsequent Fed announcement.
USD/JPY is currently trading at JPY104.3050, close to flat on the day after correnting from a dip on the BoJ policy announcement. The pair fell to JPY103.9905 before recovering to a high of JPY104.5650.
BoJ holds easing levels pending April sales tax hike
The central bank also moved to hold easing measures at their current levels, maintaining its JPY70 trillion expansion of its monetary base. With inflation accelerating towards the BoJ’s 2 percent target, it is likely that it will wait until after the sales tax increase kicks in on 1 April before it decides whether to expand its easing programme.
“Prices have been moving in line with our forecast,” said Governor Haruhiko Kuroda in the press conference following the rate announcement. “If upside or downside risks don’t materialize, we’ll continue with current policy.”
BoJ announcement in line with expectations
The BoJ announcement came in as expected, with little to push USD/JPY higher. The pair has been driven by the diverging monetary policy expectations between the BoJ and the US Federal Reserve. While the BoJ has stated that it is prepared to increase its bond purchases if deflationary pressures warrant, the Fed is anticipated to be on a cycle of tapering its monthly asset purchases.
Any challenges to the three-and-a-half-year high at JPY105.4415 posted at the beginning of the month may have to wait until the Fed’s FOMC meeting on 28-29 January and the subsequent Fed announcement.
USD/JPY is currently trading at JPY104.3050, close to flat on the day after correnting from a dip on the BoJ policy announcement. The pair fell to JPY103.9905 before recovering to a high of JPY104.5650.