The yen is poised for its longest stretch of weekly declines since February as Japanese benchmark yields at the lowest relative to the U.S. in two months damped demand for the nation’s assets.
The euro reached a four-year high versus Japan’s currency before European Central Bank officials including President Mario Draghi speak today. The Bank of Japan decided yesterday to maintain unprecedented stimulus to achieve its 2 percent inflation goal. Australia’s dollar headed for a fifth-straight week of declines after Reserve Bank Governor Glenn Stevens said yesterday policy makers remained “open minded” about intervening to weaken the Aussie.
“Certainly, the BOJ’s policy stance should be working towards a weaker yen,” said Sean Callow, a senior currency strategist at Westpac Banking Corp. “Higher yields in the States will surely draw more outflows from Japan, where the BOJ is maintaining QE at full pace, and is giving every indication they will continue to do so,” he said, referring to a stimulus program know as quantitative easing.
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