Today, the US dollar was extending strength across the board in the Asian trade. Meanwhile, the yen is losing ground due to downbeat macroeconomic statistics from Japan. Japan's Ministry of Internal Affairs and Communications reported that nationwide consumer price index eased to 1.1% in March from a year ago in line with expectations from a 1.5% gain in February. Traders are discouraged with the slowdown of inflation, which still fails to reach the target level of the central bank. The core consumer price index, which excludes volatile fresh food prices, rose 0.9% year on year in March, matching the median estimate.
Protracted low inflation signals that the Bank of Japan will continue its ultra-soft monetary policy. Governor Haruhiko Kuroda always attaches importance of efforts to ensure 2% target level of inflation. The key policy rate will be lifted only on this condition. Traders are gradually shifting the focus away from safe haven assets. Amid such confidence, the USD/JPY pair is trading above 107.00. Analysts expect the currency pair to close the week in the green.