Yen up in Asia as BOJ stands pat on easing
January 23, 2014, 12:06 am TWN
TOKYO--The yen rose in Asia Wednesday after the Bank of Japan (BOJ) said its monetary easing program was winning the war against deflation and held off unveiling any fresh measures.
In Tokyo afternoon trade, the dollar edged down to 104.18 yen from 104.32 yen in New York Tuesday and 104.28 yen in Asia before the BOJ announcement. The euro weakened to 141.23 yen from 141.46 yen and to US$1.3557 from US$1.3559.
The BOJ's unanimous decision after a two-day meeting was widely expected with analysts predicting the central bank would expand its asset-buying plan later this year to counter the effects of an April sales tax hike.
The tax increase is seen as crucial to chopping Japan's eye-watering national debt — proportionately the worst among rich nations — but there are fears it will derail its economic recovery.
Observers are increasingly skeptical about the bank's ambitious timeline and investors will be watching to see if it makes any change to that target in the coming months.
The euro's modest gains came as a report Tuesday showed investment sentiment in Germany stalled unexpectedly in January after rising to a seven-year high the previous month. However, it added that the recovery of Europe's top economy remains intact.
The greenback mostly rose against other Asia-Pacific currencies.
It strengthened to 1,068.23 South Korean won from 1,064.85 won on Tuesday, to 12,153 Indonesian rupiah from 12,126 rupiah.
The dollar also rose to 45.27 Philippine pesos from 45.18 pesos, to 61.94 Indian rupees from 61.50 rupees, to 32.88 Thai baht from 32.82 baht, and to SG$1.2786 from SG$1.2764.
The Australian dollar firmed to 88.64 US cents from 88.16 cents as hopes for an interest rate cut were dampened as inflation saw a stronger-than-expected 0.8 percent rise in October-December from the previous quarter.
The Chinese yuan bought 17.21 yen against 17.26 yen.