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Yen Drops to 2 1/2-Year Low on BOJ Speculation (Bloomberg)

Posted by Akhilesh Ganti on Feb 24, 2013 5:17:00 PM

Feb. 25 -- The yen dropped to its lowest since May 2010 versus the dollar amid speculation Japanese Prime Minister Shinzo Abe is preparing to nominate Asian Development Bank President Haruhiko Kuroda as governor of the Bank of Japan. The Asian currency also declined versus the euro after the Kyodo news said Abe is likely to present Kuroda to the Japanese Diet in the middle of this week, citing unidentified government sources.

“The market has taken on board speculation that Kuroda will be the new BOJ governor and the expectation is that he will favor aggressive policy easing,” said Mike Jones, a currency strategist at Bank of New Zealand in Wellington. “That’s provided the next leg down for the yen.”
The yen weakened to as low as 94.77 per dollar, the least since May 2010, before trading at 94.69 as of 8:10 a.m. in Sydney from 93.42 in New York last week. It fell 1.5 percent to 125.11 per euro. 

The pound extended declines after Moody’s Investors Service’s stripped the U.K. of its Aaa status. The pound declined 0.6 percent to $1.5080 and slid to 87.59 pence per euro from 86.99 on Feb. 22. The euro was at $1.3215 from $1.3194.


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