Japan shares rebounds as central bank announces monetary easing

Feb 14, 2012, 6:37 GMT

Tokyo - Stocks in Tokyo rebounded Tuesday after the Bank of Japan decided on additional monetary easing to help bolster the nation's economy.

The benchmark Nikkei 225 Stock Average gained 52.89 points, or 0.59 per cent, to end at 9,052.07 while the broader Topix index was up 5.12 points, or 0.65 per cent, at 786.8.

The central bank decided to expand an asset purchase programme to about 65 trillion yen (838 billion dollars) from 55 trillion yen to prop up the economy amid the yen's rise and global economic problems.

The bank also set its price stability goal, aiming to stimulate a 1.0-per-cent increase in the consumer price index, to combat the deflation which has affected the country for over a decade.

The bank's decision also helped push the dollar higher against the yen. The Japanese currency was hovering around the upper 77-yen range to the greenback.

Tokyo stocks slid in morning trading after Moody's Investors Service cut the debt ratings of six European countries including Italy, Spain and Portugal. Moody's also changed its outlook on Britain and France's top AAA ratings to 'negative.'

On currency markets at 3 pm (0600 GMT), the dollar traded at 77.90-95 yen, up from Monday's 5 pm quote of 77.69-70 yen.

The euro was quoted at 102.54-58 yen, down from 102.96-103.00 yen late Monday, and at 1.3160-3162 dollars, down from 1.3253-3255 dollars.