On Wednesday, the euro slightly weakens against US dollar during the Asian trading, while the yen keeps improving on the recent decision to reduce long-term bond buying by the Bank of Japan.
For reference, the Bank of Japan lowered purchases of state bonds with more than 25-year maturity to JPY 80 billion (JPY 10 billion down). Moreover, it has cut redemption of bonds with 10-25 year residual maturity by JPY 10 billion to JPY 190 billion.
As commented senior analyst at Faraday Research, a vague further policy of Japan's central bank caused a sell out of state bonds, which boosted bonds profitability and drove yen up.
A senior economist from Mitsubishi Tokyo UFJ Bank shares this opinion. He believes that traders started buying yen on speculations about further policy revision by the Bank of Japan. 10-year bond yield in Japan reportedly peaked since late October.
By now the USD-EUR rate has reached $1.1930 ($1.1937 at the close of the previous session).
The euro and US dollar against yen fell to 134.04 (134.47 a day before) and 112.35 (112.65) respectively.