RTTN:Yen Extends Decline On Hopes Of More BoJ Easing
The Japanese yen extended slide against other major currencies on Thursday on expectations of more stimulus measures from the Bank of Japan, when its holds next policy meeting later this month.
The BOJ board will hold next policy meeting on January 21 - January 22.
In a meeting of Japan's Council on Economic and Fiscal Policy on Wednesday, Japan Prime Minster Shinzo Abe requested the BoJ Governor to adopt 2% inflation goal to arrest deflation. The governor, in turn, replied that bank would work with utmost cooperation with the government, raising speculation of more easing measures.
Japan's leading and coincident indices declined in November, preliminary data from the Cabinet Office showed today.
The leading index, designed to measure the direction of the economy in the months ahead, dropped to 91.9 in November from 92.8 in October.
The yen that closed yesterday's deals at 87.89 against the greenback fell 0.48 percent to a 3-day low of 88.31. The next downside target level for the yen is seen at 90.00.
Against the euro, the yen hit a 3-day low of 115.42, down 0.51 percent from yesterday's close of 114.83. On the downside, the yen may find target level at 116.00.
The yen slipped to a 2-day low of 141.55 against the pound and a 3-day low of 95.48 against the franc with 142.00 and 96.00, respectively seen as the next downside target levels. The yen finished yesterday's deals at 140.84 against the pound and 95.01 against the franc.
Construction activity in the U.K. will likely improve in 2013, and the sector is set to recover from last year's slump which was marked by tough conditions, the latest construction market survey by the Royal Institution of Chartered Surveyors (RICS) showed today.
Surveyors forecast that output in the British construction sector will increase notably this year, following a challenging 2012.
Against the Canadian unit, the yen fell to 89.57, its lowest level since January 7. The yen is likely to find next support level at 91.00. At yesterday's close, the pair traded at 89.00.
The yen dipped to more than 4-year lows of 93.31 against the aussie and 74.30 against the kiwi, compared to Wednesday's close of 92.42 and 73.81, respectively. If the yen extends weakness, it may break 95.00 against the aussie and 75.5 against the kiwi.
At 7:00 am ET, BoE interest rate decision is due. The central bank is expected to keep interest rates on hold at 0.50 percent.
The European Central Bank decision on interest rates will be at 7:45 am ET. Analysts forecast the bank to maintain the current rates at 0.75 percent.
Canada building permits and new housing price index for November, U.S. weekly jobless claims for the week ended January 5 and wholesale inventories for November are set for release in the New York morning session.
