USD/JPY Near 98.40 After BOJ Holds Policy Unchanged
Stuart McPhee | Jun 11, 2013 03:10AM ET
The yen strengthened against all of its major peers after the Bank of Japan left policy unchanged, disappointing investors who had expected the central bank to introduce measures to stem volatility in the nation’s bonds.
The Japanese currency snapped a two-day decline against the dollar as the BOJ refrained from extending the maturity of loans to banks. Australia’s dollar dropped to an almost three-year low after data showed home-loan approvals expanded by less than economists forecast.
“Those betting that the BOJ would do something were left a little disappointed,” said Jonathan Cavenaugh, a strategist at Westpac Banking Corp. in Singapore. “The near-term risk is still skewed to the downside for dollar-yen. People have been very short yen against other Asian currencies and the likes of Aussie and kiwi, so I see risk that some of those trades get unwound further from here.” A short is a bet that an asset price will fall.
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