Investing.com- The Japanese yen fell against the U.S. dollar and most of the other major currencies in Monday's Asian session after prime minister-elect Shinzo Abe continued to apply pressure on the Bank of Japan regarding the country's inflation targets.
In Asian trading Monday, USD/JPY jumped 0.17% to 84.41. The pair is likely to find support at 83.85, Friday's low and resistance at 84.60, Wednesday's high after gaining 0.86% last week.
Just one week removed from victory in Japan's most recent elections, Abe has already proven successful in getting BoJ in engage in more monetary easing aimed at weakening the yen. Last week, the central bank expanded the size of its asset-purchase program by JPY10 trillion to JPY101 trillion.
Abe is pressuring BoJ to target annual inflation of 2%. Abe has gone so far as to say he will attempt to revise a Japanese law guaranteeing the central bank's independence if that inflation target is not met. BoJ Governor Masaaki Shirakawa indicated that the central bank's inflation goal will be reviewed at its next policy meeting in January.
Shirakawa himself is under fire from Abe. Abe has pledged to replace Shirakawa, whose term expires in April 2013, with someone that is more inline with Abe's views on monetary easing and inflation. BoJ's current inflation target stands at 1%.
Abe may have the mandate he needs to impart significant change at BoJ or at least get the central bank to fall in line with his inflation and easing desires. Abe's Liberal Democratic Party swept to a convincing majority in Japan's lower house of parliament in last week's elections.
Citing rampant monetary easing throughout the developed world, Abe believes Japan must follow suit in order to keep its exporters competitive.
Elsewhere, EUR/JPY jumped 0.14% to 111.26 while AUD/JPY added 0.1% to 87.77. GBP/JPY climbed 0.15% 136.46 while NZD/JPY surged 0.22% to 69.48.
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