Yen mixed, easing speculation mounts

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IOL world currency1 Graphic: Renjith Krishnan.

The yen was mixed in Asia on Monday as dealers took a breather from a recent sell-off of the unit fuelled by hopes for further monetary easing by the Bank of Japan, which started a two-day policy meeting.

The dollar bought 81.22 yen in Tokyo trade, slightly down from 81.31 yen in New York late Friday, while the euro rose to 103.73

yen, from 103.60 yen.

The euro fetched $1.2767 against $1.2741.

Shinzo Abe said last week he would call for “unlimited” central bank easing and vowed to strike a deal with the BoJ over further measures if his Liberal Democratic Party wins next month's general election.

The yen tumbled on Friday after his comments, which would see markets flooded with cash, and dealers said the dollar may climb to around 82.50 yen.

Prime Minister Yoshihiko Noda dissolved the lower house of parliament Friday, with opinion polls suggesting his centre-left Democratic Party of Japan would likely lose to Abe's conservative LDP.

Hopes for a deal in the United States to avoid the fiscal cliff of tax hikes and spending cuts also provided support to riskier currencies.

President Barack Obama met congressional leaders from both parties to open talks on cutting the country's deficit, with the two sides stressing a willingness to find common ground. - Sapa-AFP

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