Yen ticks up after easing-sparked tumble
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TOKYO, Dec 25 AFP
December 25 2012, 2:25PM
The yen has edged higher in Asian trade after tumbling on speculation that the Bank of Japan would launch more easing measures in the face of political demands for policy action.
The US dollar bought 84.74 yen in Tokyo morning trade on Tuesday, a shade lower than 84.82 yen in New York on Monday afternoon, after climbing to 85 yen, a level last breached in April 2011.
The euro fetched 111.69 yen and $1.3178 from 111.87 yen and $1.3183 in US trade.
The Japanese currency had dipped against the US dollar and the euro on Monday after incoming prime minister Shinzo Abe, whose Liberal Democratic Party won a landslide in general elections last week, renewed calls on the Bank of Japan to take further steps to ease monetary policy.
Abe at the weekend threatened to change a law guaranteeing the central bank's independence if it did not agree to set a two-per cent inflation target as he requested in a bid to drag the country out of the deflation that has haunted its economy for years.
Tokyo markets were closed on Monday for a public holiday.
Despite pessimism over divided US lawmakers reaching a deal on the fiscal cliff, dealers said the US dollar could see more upward momentum after reaching a 20-month high earlier.
On Thursday, Japan's central bank expanded an asset-buying programme - its main policy tool - by 10 trillion yen ($A115.03 billion) to 101 trillion yen, days after the conservative LDP won a weekend election promising to boost spending and pressure the central bank for aggressive action.
With most regional markets closed for a holiday, forex trade was expected to remain quiet on Tuesday.