The yen is poised for a record stretch of weekly losses against the dollar, after data showed Japanese consumer prices dropped, adding to the case for further monetary stimulus from the central bank.
The Japanese currency touched a 2 1/2-year low before Bank of Japan Governor Masaaki Shirakawa speaks today. His policy board announced open-ended easing and a 2 percent inflation target this week. Deputy Economy Minister Yasutoshi Nishimura said yesterday the currency’s decline isn’t over and a level of 100 versus the U.S. dollar wouldn’t be a concern. The euro remained higher versus the greenback before a report which may show an improvement in German business confidence.
“The market’s looking for any excuse to sell the yen at the moment,” said Thomas Averill, managing director in Sydney at Rochford Capital, a currency and interest-rate risk management company. “The weakness in the yen has got quite a long way to go. It’s very hard to find economic fundamentals that justify buying the currency.”
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