The pair opened at Y118.81 and the euro-yen at Y137.24 in Asia Wednesday, after trading a NY range of Y118.26 to Y118.87 and Y136.87 to Y137.29. Early weakness with long liquidation pushed the pairs to Y118.16 & Y136.65 before BOJ announcement, from intraday highs of Y118.83 & Y137.30. The rates collapsed to fresh session low of Y117.67 & Y136.16, after BOJ voted 8 to 1 to keep base target unchanged and kept asset purchases at Y80 trillion. Japanese exporters lined up offers at Y118.90/119.00 capping the spot, lower Nikkei further pressured the rate lower despite reported Japanese bids at Y118.00 handle and fresh round of long liquidation forced the pairs to session low. Option expiry today noted at Y118.00 worth $1.14bn with reported demand at Y117.50/47 and model stops below and further demand noted at Y117.20/00. In the euro-yen demand at Y136.50 failed to hold the cross but demand at Y136.20/00 supported the cross to rebound to Y136.30 last and dollar-yen stands at Y117.87 last. Traders now shift focus to tomorrow ECB meeting.
