Yen under pressure ahead of leadership change at BoJ

Published: 13 Mar at 9 AM Tags: Euro, Dollar,

Share prices in Asia have been capped as investors become wary of mixed results from global equities as well as recent index highs. The Dow Jones Industrial Average again closed at a record high yesterday, the eighth day it has done so in a row. Shares in the Asia-Pacific outside of Japan have remained static. However, they have been weighed down by a drop of 0.3 per cent in Australia.

In Japan, the Nikkei stock average was down 0.5 per cent. A pause in the yen’s weakness means that some correction was likely. However further weakness is expected as the government pushes ahead with aggressive policy easing.

The US dollar has ended at 95.90 yen after shedding 0.2 per cent. The euro is also down to 124.90 yen, a fall of 0.1 per cent against the Japanese currency after hitting 126.03 yen on Tuesday - the highest it has been in a month.

The yen is under pressure ahead of new leadership at the Bank of Japan due to be announced next week. It is widely anticipated that the new governor will be someone willing to obey Prime Minister Shinzo Abe’s policies to drive down the yen.

Sterling has been hit by week industrial output figures in Britain. Poorer than expected data for January saw the pound drop to $1.4832, the lowest the currency has been since the end of June 2010.