* Dollar/yen supported by BOJ easing speculation
* BOJ plans to make negative rates core of future
* Broad slide in equities cools risk appetite, caps
* Drop in crude oil hurts Australian and Canadian dollars
By Shinichi Saoshiro
TOKYO, Sept 14 The dollar stood atop sizeable
gains versus the yen early on Wednesday lifted by a report that
the Bank of Japan is mulling further monetary easing steps,
although investor risk aversion limited its upside.
The Nikkei business daily reported that the BOJ plans to
make its controversial negative interest rate policy the
centrepiece of future monetary easing, promising to weigh
further cuts as expansions to asset buying near their limits.
The dollar was steady at 102.540 yen after going as
high as 102.745 late on Tuesday, when it ended on a 0.7 percent
The greenback's advance has been slowed, however, as the
safe-haven yen found demand in the wake of a sharp decline in
equities, with the Dow sinking 1.4 percent on Tuesday
amid a slide in crude oil prices. The Nikkei was last
down 0.6 percent.
"Japanese monetary easing expectations are supporting
dollar/yen and triggered its latest bounce. But it has been
capped below 103 yen as expectations for a September U.S. rate
hike are fading and as risk assets have turned bearish," said
Shin Kadota, chief Japan FX strategist at Barclays in Tokyo.
The euro dipped 0.1 percent to 114.940 yen after
gaining about 0.5 percent overnight.
The common currency was flat at $1.1218 after
shedding 0.1 percent the previous day.
The dollar index was steady at 95.551 following an
overnight gain of 0.25 percent, with a rise in U.S. long-term
bond yields to a three-month high buoying the greenback.
U.S. long-term yields have risen in the past month along
with a steepening in the Japanese government bond yield curve
caused by speculation over BOJ policy manoeuvres.
Commodity-linked currencies such as the Australian and
Canadian dollars struggled after oil prices tumbled.
The Aussie, also sensitive to shifts in risk appetite, was
flat at $0.7464 after retreating overnight to a
seven-week low of $0.7443.
The Canadian dollar was little changed at C$1.3162
to the dollar, close to a one-month low of C$1.3190 seen on
Oil prices fell as much as 3 percent on Tuesday after the
global energy watchdog and OPEC revised forecasts, indicating
the global crude glut could persist for much longer than
(Reporting by Shinich Saoshiro; Editing by Eric Meijer)