Currency – The yen strengthened after the BoJ

© Reuters. The yen strengthened after the BoJ

The yen broadly strengthened on Tuesday after the Bank of Japan has lowered the volume of its asset purchase program, fuelling forecasts of a slowdown of monetary stimulus later this year.

The USD/JPY gives up 0.35% to 112.72 at 02:38 AM ET (07:38 AM GMT) since 112.50.

The increase in the yen came after the BoJ has reduced by 5% the size of its bond-buyback program in its last decision, reminding investors that it will eventually normalize monetary policy.

The japanese currency was also stronger against the euro, with EUR / JPY down 0.49% to 134,71.

The euro slipped to a lowest in a week against the dollar, with slipping 0.13% to 1,1952, after having lost about 0.56% on Monday.

The fall of the euro came as investors got their profits after the recent bounce, due to concerns that the european central Bank could try to denigrate the strengthening of the currency before the monetary policy meeting this month.

After a good start to the year, the single currency had reached its highest level in four months, 1,2088, which was close to a peak of 1,2092 in September, its highest level since the beginning of 2015.

A weaker euro supports the dollar. The index dollar, which measures the greenback’s strength against a basket of currencies, rose to 92.14.

The demand for the dollar has also been supported by expectations of further increases in interest rates by the federal Reserve this year, after the employment report, released Friday in the United States has little to change the prospects of monetary tightening.

While the rate of employment growth slowed in December, a recovery in wage growth highlighted the strength of the labour market.

The pound declined against the dollar, with GBP/USD down 0.13% at 1.3551.

The dollars of australia and new zealand are progressing, with the AUD/USD up 0.13% to 0.7852 and the NZD/USD up 0.25% to 0.7189.

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