The yen was back in focus today as the Bank of Japan published a summary of opinions of its April policy meeting and Governor Kuroda spoke earlier in the day. The opinions summary of the Bank of Japan’s last meeting revealed that some policymakers considered the risks to the economy being to the downside and that the Bank should not hesitate to take additional easing measures if needed. However, other board members argued that more time was needed for the effects of negative rates to spread through the economy.
Meanwhile, the Bank’s governor, Haruhiko Kuroda, cast doubt on possible currency intervention by saying on Thursday that it would be hard for Japan’s finance ministry to weaken the yen without G7 agreement.
The dollar initially dipped against the yen in early Asian trading but reversed course to climb higher soon after as it was supported by comments from a former colleague of Kuroda who suggested that the Bank of Japan may ease policy in June or July. The greenback edged up from an earlier low of 108.22 yen to rise to just shy of the 109 level in late Asian session.
The US currency was also broadly higher against other major currencies as it rose against the euro and the pound. The euro slid to 1.1407 dollars in late Asian trading, having hit a high of 1.1446 dollars yesterday.
Sterling meanwhile was pressured ahead of the Bank of England’s May policy decision later today, which will be accompanied by the Bank’s latest quarterly inflation report. Investors will be closely scrutinizing the report as it should shed some light on the Bank’s thinking and outlook on the UK economy ahead of the EU referendum in June. Sterling fell to around 1.44 dollars in late session after coming close to breaking above the 1.45 level yesterday.
In commodities, crude oil prices held on to most of Wednesday’s gains following a surprise dip in US crude stocks. However, prices eased slightly on Thursday as production from the Canadian oil sands started returning to normal. WTI futures were last down 0.2% on Thursday at $46.14 a barrel.
Coming up later today, Eurozone industrial production data for March will be watched before the Bank of England’s policy announcement at 11:00 GMT, which will be followed by a press conference by the Bank’s governor Mark Carney 45 minutes later. In the US, the weekly jobless claims are due but speeches by the Fed’s Loretta Mester and Esther George are also likely to attract some attention.