Forex News – USDJPY hits new 11-mth high

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USDJPY hit an eleven-month high of 82.78, moving up an earlier low of 81.95 when yen had gained after the Bank of Japan announced it kept its policy on asset buying unchanged.

The US dollar is supported by expectations that the Federal Reserve will refrain from undertaking more bond buying as the recent U.S. economic revival will probably not require fresh stimulus.  The Federal Open Market Committee meets later on Tuesday to discuss U.S. monetary policy but is widely expected to keep interest rates unchanged and steer away from further quantitative easing.

The dollar index rose 79.981, not far from a high of 80.132 struck on Monday, its highest in seven weeks.

The focus is also on US retail sales for February.  The data is expected to reflect solid auto and gasoline sales and is likely to push the dollar higher, especially against the yen, with the pair likely to test the 83 yen level.

The yen is likely to follow on the downside, especially since last month’s surprise BOJ easing.