SINGAPORE- The yen fell broadly on Tuesday after the Bank of Japan (BOJ) maintained its ultra-easy monetary settings at the conclusion of its two-day policy meeting, matching market expectations.
The Japanese currency slid roughly 0.3 percent in the wake of the BOJ’s decision to leave unchanged its short-term rate target at -0.1 percent and that for the 10-year bond yield around 0 percent , though it later pared some of those losses.
It was last higher on the day, up 0.1 percent to 147.92 per dollar.
In a quarterly report on the outlook, the BOJ cut its core consumer inflation forecast for the fiscal year beginning in April to 2.4 percent from 2.8 percent projected in October. It slightly revised up its forecast for fiscal 2025 to 1.8 percent from 1.7 percent .
In the broader market, the dollar edged lower, sending sterling up 0.2 percent to $1.2737.
The dollar index fell 0.25 percent to 103.11, though remained not too far from an over one-month high of 103.69 hit last week, as traders pare back their expectations for a rate cut by the Federal Reserve in March.
Against the euro, the yen edged 0.08 percent lower to 161.32. Sterling rose 0.2 percent to 188.28 yen not far from a high of 188.91 yen hit on Friday, its strongest level since August 2015.
The offshore yuan was last 0.3 percent higher at 7.1700 per dollar. Its onshore counterpart similarly rose 0.3 percent to 7.1714 per dollar.
Down Under, the Aussie rose more than 0.5 percent to $0.6607.
The New Zealand dollar gained 0.47 percent to $0.6106, after having fallen to a two-month low of $0.60625 earlier in the session.
“With the confirmation of the continuation of monetary easing, (dollar/yen) may test 150,” said Hirofumi Suzuki, chief FX strategist at SMBC in Tokyo, citing the stark interest rate differentials between Japan and the United States.
