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Forex - USD/JPY up more than 1% as BoJ kicks off stimulus

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Investing.com - The dollar rallied more than 1% against the yen on Monday as the Bank of Japan began a new round of aggressive monetary easing measures aimed at beating deflation in the world's third-largest economy.

USD/JPY hit 98.85 during late Asian trade, the pair's highest since June 2009; the pair subsequently consolidated at 98.68, advancing 1.17%.

The pair was likely to find support at 98.06, the session low and resistance at 99.75.

The yen weakened across the board after the BoJ conducted its first government bond purchasing operation, saying it purchased JPY1 trillion of bonds with maturities of between five and 10 years, and JPY200 billion of bonds maturing in more than 10 years.

Last week the BoJ said it plans to double its asset purchase program over the next two years and extend the maturities of the bonds it purchases in a bid to achieve its 2% inflation target.

The dollar shrugged off doubts over the strength of the U.S. economic recovery after data Friday showed that the U.S. economy added fewer than expected jobs in March.

The Department of Labor said the U.S. economy added 88,000 jobs last month, the smallest increase since June and far below forecasts for an increase of 200,000.

The U.S. unemployment rate ticked down to 7.6% from 7.7% in February as more people dropped out of the work force.

Elsewhere, the euro rose to its highest level since January 2010 against the yen, with EUR/JPY advancing 1.09% to 128.20.

Germany was to release official data on industrial production later in the day.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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