Amidst looming concerns over Bank of Japan’s counter deflationary measure, the Japanese currency, Yen, has plunged to reach a weakest level since June 2009. The increase in selling pressure on Yen has been attributed to be the prime gravity behind the fall in Yen’s valuation. After the data revealed by Japanese finance ministry exhibited a larger current account surplus, Yen had started to tumble at international market. Having obtained a current account surplus of 637.4 billion Yen, current trading picture of Japanese currency is believed to be the consequences of Bank of Japan’s (BOJ) anti-deflation monetary policy.

In line with ongoing asset purchase program, BOJ has sought to increase its bond buying to a whopping 7.5 trillion Yen on a monthly basis. Further, beyond spiking bond purchase, the authority has also suspended the cap or ceiling on the bond holdings and dropped the limits on bond maturities. This move of BOJ explicitly exhibits its concern towards eradicating the ongoing deflationary economic regime, which has been continuing since last 15 years, and its desperateness to attain the desired 2 percent inflation rate within the time span of 2 years from now.

The market, citing the proposed meeting of 26^th of April, has been forecasting the Yen to further decline as the possibilities of further reforms or policies to support the ongoing asset purchase program are at higher end. Japanese Yen, despite having observed not very attractive US payrolls last week, had continued to decline against the green back amidst ongoing Japanese stimulus regime.

If we move out of the Japanese economy and head towards the US economy, the ongoing quantitative easing program in the largest economy of the world, i.e., the US, could be expected to put some upward pressure on the Yen. With both the nations intensively going for monetary stimulus or economic expansionary measures, it is extremely tough to predict the magnitude of each of these currencies in the coming days. Its only economic indicators, more specifically the portrait of unemployment and rate of inflation, which could possibly determine the momentum and magnitude of these currencies and their cross-valuation at international market. With the US having started to gain some economic recovery and Japan strictly focusing to shift its economy from deflationary to inflationary, many market participants are coming of the views that Yen has a long way to go towards south before reaching the finish line or target as set by the BOJ.