TOKYO: The dollar eased further against the yen in Asia Thursday, adding to losses in New York after comments from Federal Reserve chief Ben Bernanke suggested its huge stimulus program would stay in place for some time.
The greenback changed hands at 99.43 yen in Tokyo morning trade after tumbling into the 98-yen range earlier in the day. It had tumbled to 99.59 yen in New York late Wednesday from 101 yen in Tokyo earlier in the day.
The euro bought $1.3081 and 130.08 yen, compared with $1.3013 and 129.59 yen.
Traders moved out of the US unit after Bernanke poured cold water on the likelihood of a wind-down to the Fed’s $85-billion-a-month bond-buying program put in place in September to kickstart the US economy.
Bernanke insisted the easy-money policy was still necessary, because the jobs market remained weak and inflation was too low for comfort.
“Both the employment side and the inflation side are saying that we need to be more accommodating,” he said, answering questions after a speech.
“Moreover, the other portion of macroeconomic policy, fiscal policy, is now actually quite restrictive…. Put that all together, I think you can only conclude that highly accommodative monetary policy for the foreseeable future is what’s needed in the US economy,” he said.
“Highly accommodative” policy could be interpreted differently but “the use of word ‘highly’ by hawkish chairman Bernanke may make the market reassess its projection of tapering timing,” Hiromichi Shirakawa, research analyst at Credit Suisse, said in a note.
The market consensus had been for the the bank to start reeling on the spending in September but players may now expect a move in October or December, he said.