Japanese stocks slipped and the yen strengthened versus the dollar before the Bank of Japan concludes a monetary policy meeting. Shares in the rest of Asia gained, while New Zealand’s currency traded near a 2 1/2-year low after a surprise drop in consumer prices.
The Topix index fell 0.5 percent by 10:44 a.m. in Tokyo, while the yen advanced 0.3 percent following yesterday’s 1.1 percent drop. The Bloomberg Dollar Spot Index was within 0.5 percent of a 10-year closing high set on Jan. 8, and the kiwi was little changed at 76.35 U.S. cents. The MSCI Asia Pacific excluding Japan Index added 0.5 percent. Oil in New York traded at $46.84 after plunging 4.7 percent yesterday.
Plunging oil prices may force the BOJ to reduce its inflation forecast, increasing pressure for Governor Haruhiko Kuroda to add to record stimulus. The prospect of Federal Reserve interest-rate increases is boosting the allure of the U.S. dollar while central banks elsewhere add stimulus. Europe’s benchmark stock index reached its highest finish since January 2008 yesterday on speculation European Central Bank President Mario Draghi will broaden asset purchases.
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