US dollar lost positions against the Japanese yen on Tuesday after Bank of Japan announced its decision earlier to introduce no change in its monetary policy.
USD/JPY pair fell to 97.70 during the later hours of Asian trade, currently the session low, after which consolidation followed at 98.34. Support was expected at levels around 97.50, while resistance was to be encountered at June 5th high, 100.45.
Japanese yen boosted its positions on Tuesday after domestic shares tumbled overnight on Bank of Japan decision to leave monetary policy on its current course. Governor Haruhiko Kuroda and his colleagues left long-term interest rates intact, as 10-year government bond yield was rising. Japans government bond yield fell to a record low in April. Additionally, the central bank said economy was picking up the pace, after on Monday official report showed that in annual terms the Gross Domestic Product grew by 4.1% during Q1 2013. This result exceeded preliminary estimates of a 3.5% increase, which was the rate of increase during Q1 2012, compared to Q1 2011.
Meanwhile, market players remained focused on potential decision by FED to taper bond purchases, especially after the positive signal from Fridays US job report and after ratings agency Standard & Poors revised its outlook, regarding the credit rating of the United States on Monday.
The yen moved up against the euro as well, with EUR/JPY pair slipped to 130.39, down by 0.37% for the day.
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