Yen Falls As BoJ Sakurai Says Current Monetary Easing Required
October 18 2017 - 2:00AM
RTTF2
The Japanese yen declined against its major counterparts in
early European deals on Wednesday, as the Bank of Japan board
member Makoto Sakurai remarked that the bank should maintain its
monetary easing in the current framework.
Sakurai said price movements are weak and there is a long way to
go to achieve the inflation target of 2 percent. The bank should
take this point seriously, he noted.
Sakurai said the bank should not change its 2 percent inflation
target. It contributes to stabilize foreign exchange rates in the
long run and also to achieve price stability.
The BoJ board holds next monetary policy meeting on October 30
and 31, when it will publish inflation forecasts.
Japanese parliamentary elections are due on Sunday, with
investors expecting the ruling coalition to attain victory. Opinion
poll conducted by Kyodo News forecast that Abe may win two-thirds
of seats in the lower house.
The currency was also weighed by risk appetite, as European
shares rose on a higher dollar amid speculation over next Fed Chair
and as China pledged to deepen economic and financial reforms.
The currency has been trading lower against its major rivals in
the Asian session, with the exception of the pound.
The yen weakened to 114.94 against franc and 148.63 against the
pound, from its early highs of 114.60 and 147.90, respectively. The
next possible support for the yen is seen around 116.00 against the
franc and 150.00 against the pound.
The yen hit a 2-day low of 132.38 against the euro, 8-day low of
112.73 against the greenback and a 5-day low of 89.99 against the
loonie, off its early highs of 131.96, 112.14 and 89.55,
respectively. If the yen falls further, it may find support around
134.00 against the euro, 113.5 against the greenback and 91.00
against the loonie.
The yen that closed Tuesday's trading at 88.01 against the
aussie slipped to a 2-day low of 88.21. The yen is seen finding
support around the 89.00 region.
Looking ahead, U.S. building permits and housing starts for
September as well as Canada manufacturing sales for August are due
in the New York session.
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