Yen Falls as Traders Anticipate More Stimulus from Bank of Japan

The Japanese yen slipped today versus the US dollar and the euro today as Forex traders were concerned that the Bank of Japan will continue expanding its asset purchase program to counter deflation.
The BoJ made a move that surprised most market analysts as the bank boosted its asset purchase program by 10 trillion yen to 30 trillion on February 14. BOJ Governor Masaaki Shirakawa said that the central bank set 1 percent inflation target to show that the bank is committed to battle deflation. Japan’s consumer price index fell 0.2 percent in December.
On top of that, growing existing home sales in the United States reduced demand for safety of the yen, even though the growth was slower than expected by economists. The Forex market has bias for safety still as most investors are afraid of default of Greece despite the bailout and macroeconomic data from Europe and China wasn’t good.
USD/JPY climbed from 79.70 to 80.25 and EUR/JPY advanced from 105.46 to 106.32 as of 22:11 GMT today.

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