The yen rose for a third day, the longest stretch in almost two months, on speculation Japanese consumer price data this week will add to evidence that the central bank’s monetary stimulus is failing to stoke inflation.
Japan’s currency was supported as technical indicators signaled that the currency’s plunge to a 2 1/2 year low this week was too rapid. The Bank of Japan increased its price-gain target to 2 percent yesterday and announced open-ended asset purchases to start next year. It predicted inflation will accelerate 0.9 percent in the fiscal year beginning April 2014. The euro was 0.7 percent from its highest in almost 11 months ahead of data that may add to signs of recovery in the region.
“It’s hard to sell the yen on hopes that inflation will rise,” said Junya Tanase, chief currency strategist at JPMorgan Chase & Co. in Tokyo. “The BOJ’s outlook for consumer prices was only slightly higher than previously forecast,” Tanase said in reference to the bank’s projection in October for a 0.8 percent gain in prices next fiscal year.
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