The yen surged after the Bank of Japan decided to trim slightly its purchases of Japanese government bonds in its overnight operation. Yesterday, the BoC Business Outlook Survey for Q4 fueled further speculation for a hike at the Bank’s upcoming gathering, scheduled next Wednesday.
The US dollar traded mixed against its G10 peers on Monday. The main winners were JPY, AUD, and NZD, while the main losers were SEK and EUR. The dollar traded virtually unchanged against CAD.
Yen Surges as BoJ trims its JGB purchases
The currency that gained the most against the greenback was the yen. The Japanese currency came under strong buying interest during the Asian morning Tuesday after the Bank of Japan cut its purchases of Japanese government bonds. The Bank bought JPY 190bn of 10-25 year JGBs in this operation, less than the JPY 200bn it bought last time, while it bought JPY 80bn of bonds with maturity of over 25 years, compared JPY 90bn previously.
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