Bank of Japan Cuts by 20bp to 0.30%, Yielding Mixed Reactions

Dollar-Japanese Yen (USDJPY) drops after a split vote by the BOJ to cut rates, with the 25 bp easing decided by BOJ Gov Shirakawa. The news further underpins the market view that political pressure, the spate of global rate cuts this week were a key factor forcing the BOJ to act to ease. USD-JPY slumped sharply from 98.50 to 97.80 on the news, while the EUR-JPY has declined form 126.50 to 125.17 since the BOJ will be reluctant to act again. Stops on USD-JPY are expected under 97.40, with key support at 96.00 and the base of the current trading range.

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