Japanese yen is mostly lower today, dropping on expectations that aggressive easing will keep the Asian currency lower against its major counterparts.
The Bank of Japan, with its new head Haruhiko Kuroda, is setting a bold target to beat deflation, no matter the cost. Kuroda’s sentiments are just what recently-elected Prime Minister Shinzo Abe wants to hear. The assumption is that more stimulus, thanks to an expanding asset purchase program, will further weaken the yen.
Alan Mulally, the CEO of Ford Motor Company, is complaining about currency manipulation by the Japanese. Leaders in Japan have long promoted a policy of yen weakness, since it makes exports from Japan weaker. However, while the leaders have been reluctant to intervene directly (or at least be seen intervening), this new era for the Bank of Japan indicates that yen weakness might very well become acknowledged policy.
For now, the yen is mostly lower, dropping on expectations for stimulus, as well as a slight uptick in risk appetite since the release of the latest US home prices data indicates improvement in the US economy.
At 17:03 GMT USD/JPY is up to 94.3360 from the open at 94.1770. EUR/JPY is up to 121.2500 from the open at 121.0080. GBP/JPY is up to 142.9335 from the open at 142.8950.
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