The American dollar reached its two-and-a-half year highs against the yen in USDJPY today, after Japanese Prime Minister Shinzo Abe incited the Bank of Japan to accept a 2% inflation target.
During the late Asian trade, currency pair USDJPY hit the level 89.67, the highest level for this pair since June 2010, later on it consolidated at 89.39, adding 0.23%.
The pair USDJPY was supposed to meet support at 88.68, bottom from Friday and resistance at 90.57.
Prime Minister Abe announced yesterday that the BoJ have to set a clear 2% inflation target in the medium term.
Besides, the prime minister announced that he is going to meet with monetary policy experts later this week in order to discuss potential successors to BoJ Governor Masaaki Shirakawa, whose term is planned to finish in April.
At the same time, investors are expecting a speech by Federal Reserve Chairman Ben Bernanke on monetary policy later today, among speculation that the Fed chief is going to reject assumption over an earlier end to the central bank’s quantitative easing program.
The yen reached its twenty-month lows against the euro, with EURJPY trading at 119.40.
Demand for the euro found support after European Central Bank President Mario Draghi announced last week that a consecutive recovery in the euro zone economy is going to start this year.