Forex - Bank of Japan cut interest rate by 20bp to 0.3%
The Dollar rose against the Yen on Thursday, but was little changed against the Euro, after gains in world stock markets and an interest rate cut by the Federal Reserve on Wednesday helped ease the recent flight into the dollar. Adding to pressure on the Yen was growing speculation ahead of the Bank of Japan interest rates cut this night by 20bp to 0.3%.
The Dollar also edged higher against the Euro fueled by month-end
demand from fund managers seeking to square their books or
rebalance their portfolios.
The rebound in stocks and high-yielders came after the Federal Reserve reduced borrow ng costs by 50bp to 1% on Wednesday and left the door open for further easing of monetary policy. The Fed also approved currency swap lines with central banks in several major emerging countries, making Dollars available to help them deal with the credit crunch.