Japanese Yen falls after Bank of Japan maintains ultra-easy policy
The Japanese Yen fell 2.06 percent against U.S. dollar at 130.80 per dollar on Wednesday in the aftermath of January’s Bank of Japan (BOJ) monetary policy announcement.
This defying market expectations that rising inflation could force the central bank to move away from low interest rates.
BOJ has surprised the market last month by raising its cap on 10-year bond yields to 0.5 percent from 0.25 percent, doubling the range allowed above or below its zero target.
The dollar index, which measures the performance of the U.S. safe-haven currency against six other major currencies, rose 0.352 percent to 102.750.
BOJ kept its Yield Curve Control (YCC) targets unchanged as it concluded a two-day policy meeting on Wednesday.
It left the short-term interest rate at an ultra-dovish minus 0.1 percent and the 10-year Japanese Government Bonds (JGB) yield around zero percent.
The YCC policy is a pillar of the central bank’s effort to keep interest rates low and stimulate the economy.
The Bank will continue with Quantitative and Qualitative Monetary Easing (QQE) with YCC, aiming to achieve the price stability target of 2 percent, as long as it is necessary for maintaining that target in a stable manner.
