Dollar inches higher against yen and euro

The yen has dipped slightly against the US dollar as has the euro ahead of policy meetings at both the European Central Bank and the Bank of Japan. The dollar is currently trading at 93.50 yen, a rise of 0.1 per cent.

New governor of the BoJ, Haruhiko Kuroda, is expected to push forward with stimulus plans although the bar has been set high for him to exceed market expectations, according to ABN AMRO Bank FX strategist Roy Teo.

Kuroda has already said that he intends to combine government debt purchasing schemes, a signal that he will be ramping up monetary stimulus.

The euro hit $1.2804, a drop of 0.1 per cent against the greenback and close to the four-month low set last week of $1.2750. Data from the eurozone indicates that economically the region contracted last month. Manufacturing continued to decline during March according to Markit’s Eurozone Manufacturing PMI.

A policy meeting at the ECB is expected to result in President Mario Draghi announcing that interest rates will remain at the current 0.75 per cent record low. Although the Bank of England is expected to hold steady when it meets on Thursday, the problems with the pound are likely to result in more government bond-buying in the near future. Sterling hit $1.5086, a slip of 0.1 per cent.