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Forex - USD/JPY dips after BOJ raises growth forecasts for 2011

Published 01/25/2011, 03:30 AM
USD/JPY
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EUR/JPY
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Investing.com – The U.S. dollar was lower against the yen on Tuesday, after the Bank of Japan revised up its growth forecasts for the year through March and predicted a faster rate of inflation.

USD/JPY hit 82.34 during European early morning trade, the daily low; the pair subsequently consolidated at 82.43, slipping 0.09%.

The pair was likely to find support at 81.99, the low of January 20 and resistance at 82.91, Monday’s high.

Earlier in the day, the BOJ said Japan’s economy may expand 3.3%, raising the estimate from 2.1% in October. The bank kept its key interest rate unchanged at 0.1%, in a widely expected move.

The central bank also forecast that consumer prices will increase 0.3% in the year starting April, higher than its October prediction of 0.1%.

The BOJ upgraded its assessment of the economic outlook, saying that “Japan’s economy is expected to gradually overcome the deceleration in the pace of improvement and return to a moderate recovery path.”

Meanwhile, the yen dipped against the euro, with EUR/JPY easing up 0.06% to hit 112.61.

Later Tuesday, the U.S. was to publish industry data on house prices as well as a report on consumer confidence.

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