The Japanese yen, meanwhile, soared after the Bank of Japan expanded stimulus at its highly anticipated meeting, but disappointed investors who had expected bolder measures to stimulate growth and raise inflation in Japan’s ailing economy.
Advertisement
At the two-day rate review that ended on Friday, the BoJ made a decision to increase ETF purchases so as to increase its total holding at an annual pace of 6 trillion yen ($58 billion), up from the current 3.3 trillion yen. It also left untouched the minus 0.1 percent rate for a portion of commercial banks’ reserves.
Silver futures for September delivery gained 0.35% to $20.263 a troy ounce, while copper futures for September delivery nudged down 0.09% to $2.214 a pound.
The central bank, however, said it will conduct a thorough assessment of the effects of negative interest rates and its massive asset-buying program, suggesting that a major overhaul of its stimulus program may be forthcoming.
JAPAN-ECONOMY: Japan’s central bank opted Friday for a modest expansion of its lavish monetary stimulus to help perk up sluggish growth and combat deflation. A dollar bought 102.8 yen immediately after the BoJ decision.
The lack of quantitative easing did boost the yen, with the currency rising by as much as 2.5% against the US dollar Friday in Asia trade and gaining 2.9% for the week.
Japanese yen rallied ahead of the government’s announcement, trading at 104.44, up 0.76 per cent at 10.40 am.
The yield is still down four basis points since last Friday, with the securities headed for a second weekly gain.
MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 0.64 percent, sliding back from its highest level since August 11 struck earlier in the day.
Before the BOJ’s decision, many investors warned of a big chance of disappointment because markets have long expected more stimulus, making it hard for BOJ Governor Haruhiko Kuroda to spring a surprise.
Wall Street shares remained near all-time highs, with tech heavyweights Alphabet and Amazon rising after the bell as their earnings beat expectations. United States gold rose 0.6% to $1,349.00 an ounce.
Oil prices steadied amid short-covering after a week-long selloff and were on track to end the month about 15 percent lower on persistent glut concerns, with the biggest decline seen for US crude in a year. It is down 7 percent this week and 14.6 percent this month. It fell 78 cents to close at $41.14 a barrel on Thursday.
Advertisement
“With underlying inflation set to moderate further toward the end of the year, we think that the bank will still have to provide more easing before too long”, Marcel Thieliant of Capital Economics said in a commentary.
