American focus: Yen updated 27-month low against the dollar

The yen fell against the dollar to the lowest level since September 2010 as Japan’s Prime Minister Shinzo Abe said he would push for “bold monetary easing.”

Abe said in a speech in Tokyo today he would carry out a flexible fiscal policy. Taro Aso was named finance chief today. During his 12 months as prime minister through September 2009, the one-time Olympian compiled three extra budgets worth about 20 trillion yen, abandoned a target to balance the budget by March 2012 and distributed a 12,000 yen-per-person cash handout.

The Japanese currency slid versus all its major peers as minutes of the Bank of Japan’s November meeting showed that a board member suggested conducting open-ended asset purchases.

An unnamed BOJ board member said that an option would be to “clearly present” in a policy statement that the central bank would continue monetary easing, including asset purchases, “without setting any time frame” until 1 percent inflation is achieved, the minutes showed. The BOJ’s 76 trillion-yen ($890 billion) program that buys securities ranging from government bonds to stock funds will expire at the end of next year.

The Dollar Index fell as investors waited for U.S. Congress and President Barack Obama to resume talks on averting the so-called fiscal cliff.

Obama plans to leave his Hawaii vacation today and return to Washington, a White House aide said on condition of anonymity. Congress will resume negotiations tomorrow about more than $600 billion in tax increases and spending cuts due to take effect next month.

Markets in Canada, Australia and the U.K. were shut for a holiday.