Reuters: US Dollar Report: FOREX-Yen slides as BOJ begins new age with a bang

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FOREX-Yen slides as BOJ begins new age with a bang Apr 7th 2013, 22:12 Sun Apr 7, 2013 6:12pm EDT SYDNEY, April 8 (Reuters) - The yen resumed its precipitous slide early Monday to hit fresh lows against a host of major currencies as reports the Bank of Japan would begin buying longer-dated bonds immediately underlined its determination to beat deflation. The U.S. dollar jumped a full yen in early Asian trading to hit 98.78 yen, the highest since June 2009. The euro climbed as far as 128.32 yen, its highest since January 2010. Dealers were impressed by a Nikkei report the central bank would this week buy 1.2 trillion yen of government bonds with a maturity of over five years, showing a sense of urgency alien to the BOJ of old. Analysts assume the flood of new money will be partly used by Japanese investors to buy higher yielding assets abroad, so putting downward pressure on the yen. "We have re-established a broad basket of JPY shorts in light of last week's BoJ aggressive actions," wrote analysts from JPMorgan in a client report. "Radical monetary measures were needed to re-invigorate the downtrend in the yen, and on this front the BoJ has over delivered." JPMorgan had re-established long positions in USD/JPY and also favoured the Australian dollar and Brazilian real as carry trades against the yen. The Aussie dollar soared to 102.32 yen, the highest since July 2008.

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