Yen awaits BOJ verdict, GDP data also eyed
The yen held near multi-year lows against the dollar and euro on Thursday, finding a bit of stability following a few sessions of volatile trade as the outcome of a Bank of Japan policy meeting loomed.
The BOJ is expected to keep monetary policy steady but signal its readiness to expand stimulus again if risks to the outlook heighten.
The dollar bought 93.26 yen, not far off a 33-month high around 94.47 set on Monday. The euro fetched 125.26 , near a 34-month peak of 127.71 scaled a week ago.
Analysts say markets suspect the BOJ will stand pat until the first rate review under a new governor, scheduled for April 3-4.
"This leaves the risks that the BOJ actually does positively surprise the market. Nonetheless, it may be more prudent to wait and buy USD/JPY on the 90 handle, as the risk trade is somewhat stretched," analysts at Societe Generale wrote in a note.
They added that the surprise on Thursday could come from South Korea, whose currency has risen strongly against the yen possibly denting its export competitiveness. A Reuters survey, however, found the Bank of Korea will probably hold rates steady for now.
Since November, the dollar has soared around 20 percent on the yen, while the euro has gained about 25 percent as the BOJ came under relentless political pressure to deliver bold policies to defeat deflation.
Markets turned nervous this week ahead of the BOJ meeting as well as a G20 summit starting Friday, worried that Japan's international peers would complain about
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