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The Bank of Japan has changed its monetary policy. The yen has fallen

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The Bank of Japan has changed its monetary policy. The yen has fallen

The Bank of Japan has changed its monetary policy. The yen has fallen
September 21
10:30 2016

On Wednesday the Central Bank of Japan has added targeting of the long-term interest rates to the broad program of the asset purchase. The Central Bank has reconsidered the principles of its monetary policy and again promised to reach the inflation rate of 2 percent in the near future.

In addition, the regulator said that it was planning to let the inflation exceed the target, adhering to a very soft monetary policy.

As a result of the two-day meeting the Bank of Japan has left the negative rate at the level of minus 0.1 percent on Wednesday.

Meanwhile, the Central Bank has refused to target the monetary base and selected “the control of the yield curve,” which involves buying long-term government bonds in order to fix the yield on 10-year bonds around the current zero rates.

The Bank of Japan said it would continue to buy long-term government bonds on purpose to favor an increase of its assets by 80 trillion yen ($ 781 billion) per year.

On Wednesday morning the yen has fallen against the dollar and euro on the background of the decision of the Japanese controller. In addition, the fact that investors were buying dollars in anticipation of the results of the Fed meeting has also influenced the fall of the yen.

By Wednesday morning the dollar has risen by 0.82 percent, reaching 102.51 yen.

The euro has risen by 0.65 percent to 114.12 yen. The euro has fallen against the dollar by 0.18 percent to $ 1.1132.

The data in Japan on Wednesday have showed that Japan’s exports fell by 9.6 percent in August in the annual term. The fall of the exports has been going on the 11th month in a row.

The pound sterling has dropped to 0.12 percent and became equal to $ 1.2973.

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