The Japanese yen was the weakest currency on the Forex market today as the risk sentiment stabilized. Releases from the Bank of Japan did nothing to help the currency.
The BoJ released Summary of Opinions at the March monetary policy meeting today. The central bank mentioned that the slowdown of other economies can hurt the economy of Japan:
While uncertainties regarding overseas economies started to become apparent from around last autumn, slowdowns have materialized. Reflecting these developments, downside risks to Japan’s economy clearly have been heightening recently. Exports and production have shown some weakness, and it is necessary to pay close attention to whether this will affect future business fixed investment plans.
The bank signaled that it is going to maintain its extremely accommodative monetary policy:
In order to maintain the highly accommodative financial conditions, it is essential to persistently continue with the current monetary easing policy while taking account of developments in economic activity and prices as well as financial conditions in a balanced manner.
At the same time, the bank stated that it is ready to adjust policy if necessary:
In case developments in economic activity and prices undergo a phase shift, it is important to make preemptive policy responses.
Also released by the BoJ, the Service Producer Price Index rose 1.1% in February from a year ago. While the pace of growth accelerated from 1.0% registered in January, it still missed the average forecast of 1.2%. The BoJ core Consumer Price Index rose 0.4% in February, year-on-year, after increasing 0.5% in January.
USD/JPY gained from 109.97 to 110.36 as of 10:21 GMT today. EUR/JPY advanced from 124.41 to 124.89. AUD/JPY rose from 78.19 to 78.67.
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