* Dollar/yen and euro/yen push higher
* Steadier gold, after historic plunge, soothe jitters
* Thursday’s G20 meeting eyed for talk on yen weakness
By Anooja Debnath
LONDON, April 17 (Reuters) - The yen fell broadly on Wednesday and will likely suffer further losses in coming sessions, succumbing to renewed pressure after a steadying of gold prices from an earlier dramatic slide helped risk assets recover.
The highly-liquid Japanese currency, which is usually sought in times of financial uncertainty, rose earlier this week after a historic plunge of around 9 percent in gold prices on Monday and on concerns about China’s slowing economic growth.
Markets, however, stabilised with spot gold finding some ground on Wednesday, rising 1 percent on the day to $1,380.39 per ounce.
This helped the yen resume its fall which was triggered by the Bank of Japan’s aggressive stimulus programme earlier this month. Strategists said markets will focus on the Group of Twenty meeting beginning on Thursday, for any comments on concerns about the Japanese currency’s weakness.
The dollar was up 0.8 percent on the day at 98.25 yen , although still down about 1.6 percent from a four-year high of 99.95 yen set last week. Traders cited buying by Japanese importers earlier in the day.
The euro climbed 0.8 percent to 129.52 yen, but stayed some way off a three-year peak of 131.10 yen hit last week.
“The dollar has now rebounded strongly... over the next couple of days we might see some consolidation around current levels but with the easing from the BOJ we think the dollar will trade higher versus the yen,” said Marcus Hettinger, global FX strategist at Credit Suisse adding he expects the pair to hit 102 yen within the next three months.
The BOJ’s radical monetary policy overhaul will pump about $1.4 trillion into the economy in less than two years, via a bond-buying scheme that is expected to drive Japanese investors to look overseas in search of better yields.
Strategists, however, cautioned that the dollar was likely prone to retracement versus the yen given its swift rise since mid-November when Japan’s current prime minister began calling for aggressive easing as part of his election campaign.
The dollar has gained about 28 percent from its lows last October.
In the near-term, the market will be look at the G20 meeting beginning on Thursday, where finance ministers and central bankers from the world’s leading economies will discuss the economic and financial market outlook, including the Cyprus crisis and asset price reactions.
Strategists said it seems unlikely that Japan will face any significant criticism over the BOJ’s aggressive monetary easing.
“Japan’s easing objective is domestic as they try to fight deflation and they are only buying domestic assets and not foreign bonds, so I don’t think there will be any criticism especially now after the correction lower in dollar/yen,” said Hettinger.
A senior Canadian financial official said on Tuesday that Canada was supportive of Japan’s effort to kick-start its economy and that the G20 believed policy should target domestic economies and not exchange rates.
The International Monetary Fund also showed its support saying Japan’s expansion drive was not excessive and it could help haul its economy from stagnation.
“We continue to look to use dips (in dollar/yen) to re-establish bullish strategies. The comments from the delegates at the IMF meetings so far appear to be supportive of the Japanese policy approach,” analysts at Morgan Stanley said.
The euro was flat against the dollar at $1.3185, after having hit a seven-week high of $1.3202 on Tuesday, partly helped by its bounce versus the yen.
The single currency had added to its gains on Tuesday after breaching resistance at its 100-day moving average at roughly $1.3155, a level which could now act as support for the euro.