Yen climbs after BOJ pledges to buy assets
By Ellen Freilich
NEW YORK (Reuters) - The yen rose to a three-day high against the dollar on Tuesday after the Bank of Japan said its open-ended commitment to buy assets would kick in only next year, disappointing those who expected more aggressive monetary easing.
Global stock markets were mixed, with Japanese equities .N225 and world indices higher on the BOJ news but Europe slightly lower. U.S. markets were mostly higher.
The euro pared sharp losses against the yen and was last little changed against the dollar after a German ZEW survey showed economic sentiment at its highest since May 2012.
Japan's central bank, which has been under intense political pressure to overcome deflation, doubled its inflation target to 2 percent, as had been widely expected.
It also said it had decided to switch to an open-ended approach of buying a certain amount of assets each month next year, without setting a deadline for completing the purchases.
"The yen strengthened after weakening since mid-November in anticipation of the BOJ's plan to set a target of 2 percent for inflation and do unlimited quantitative easing until it gets there," said Jonathan Garber, macro analyst at Briefing.com in Chicago.
Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington, said "the medium trend lower for the yen remains intact."
The dollar was down 0.8 percent against the yen at 88.88. Earlier it had fallen past reported stops at 88.50 yen to hit a session low of 88.35 yen. Continued...