Yen weakens in Asian market as Bank of Japan meeting starts


TOKYO–The yen weakened in Asia on Tuesday with a Bank of Japan (BOJ) two-day meeting in focus as investors wait to see if policymakers unveil fresh measures as part of its stimulus program. In Tokyo afternoon trade, the dollar rose to 104.65 yen, from 104.10 yen in London late Monday. U.S. markets were closed Monday for a public holiday.

The euro also firmed to 141.74 yen from 141.19 yen, while the single currency weakened to to US$1.3546 from US$1.3563 ahead of a German investor sentiment survey later in the day. Investors are waiting to see if the BOJ adds to its vast asset-buying scheme launched in April and which is a cornerstone of Prime Minister Shinzo Abe’s campaign to kickstart the world’s third-largest economy. However, most analysts expect the bank to hold steady on new measures until it can gauge the effect of an April sales tax rise. The rate hike, seen as crucial to containing Japan’s massive national debt, has stoked fears it could derail the country’s recovery and lead to a further expansion of its monetary easing. The BOJ has set a target of 2.0 percent inflation within two years as part of a bid to reverse years of falling prices, which have weighed on growth, but observers are increasingly skeptical about its ambitious timeline. The greenback was mixed against other Asia-Pacific currencies. It edged up to 1,064.85 South Korean won from 1,063.14 won on Monday, to 12,126 Indonesia rupiah from 12,120 rupiah, and to 45.18 Philippine pesos from 45.12 pesos. The U.S. unit eased to 61.50 Indian rupees from 61.62 rupees and to 32.82 Thai baht from 32.88 baht, and to SG$1.2764 from SG$1.2769. The Australian dollar firmed to 88.16 U.S. cents from 87.77 cents and the Chinese yuan bought 17.26 yen against 17.17 yen.