Bank of Japan policy easing announcement expected soon
Published: 19 Sep at 11 AM
The yen remained down on the dollar in Asian trading on Wednesday as speculation mounted that the Bank of Japan could be ready to ease monetary policy when its two-day meeting draws to a close later today.
Experts say that he chances the BOJ could carry out action have gone up since the US Federal Reserve announced last week that it was set to launch large-scale asset purchases. That news saw the yen shoot up to a seven-month peak on the greenback, something that did not bode well for an economy that is reliant on its already struggling exports.
The dollar last stood at 78.77 yen, close to its one-week peak of 78.93 that it hit on Monday. Should it break through that barrier, experts are of the opinion that it may even test the high it reached on 7 September of 79.03, followed by its August peak of 79.66.
If the BOJ does decide to carry out policy easing, traders predict that the yen will drop further. Analysts from Societe Generale said in a note that the market is looking for another funding story, and that what is happening in Japan is compelling. The central bank is due to make an announcement later on Wednesday.