The dollar dipped against most of its rivals on Tuesday after a string of disappointing data from the U.S. Investors also monitored the Bank of Japan meeting due to be finished Wednesday. The Aussie strengthened following the central
bank’s decision to stand pat.
The greenback was last at ¥120.26 from ¥120.46 late Monday in New York.
The U.S. currency was also lower against the euro, which rose to $1.1210 from $1.1190 late Monday. The shared currency was almost unchanged against the yen, last seen at ¥134.76 from ¥134.79.
Stock market sentiment improved following agreement on the Trans-Pacific Partnership deal, and as risk appetite rose after series of downbeat U.S. data, including NFP report and ISM report.
Japan's Nikkei Stock Average gained momentum and was up 1%.
Meanwhile, many market players expected that the Bank of Japan would ease its monetary grip later this week, at its policy setting meetings scheduled on Oct. 6-7 and possibly at an Oct. 30 meeting.
Many Tokyo-based market players don’t expect the regulator to take additional easing steps at least this week, on top of its main policy tool of 80-trillion-yen-a-year asset buying program. However, recent dismal economic data suggests the economy has returned to recession over the summer, while several measures of inflation expectations show signs of flagging, raising more uncertainty about the BOJ’s action in the near future.
“Regardless of whether it takes action tomorrow or later, an additional easing (by the BOJ) looks inevitable,” given slow inflation, said Marito Ueda, director at FX Prime byGMO.
He also said that the latest TPP deal deal, which is unpopular among some of main supporters of the ruling Liberal Democratic Party, can make Prime Minister Shinzo Abe put together an additional economic stimulus partly in the form of monetary easing.
