FOREX-Yen edges up after BOJ, pound gains on hopes of lockdown easing

* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
* FX markets look to central bank meetings
* Coronavirus impact tests policymakers
* Currencies falling into tight ranges

By Stanley White
TOKYO, April 27 (Reuters) - The yen edged higher on Monday
after the Bank of Japan expanded stimulus to help companies hit
by the coronavirus crisis while the pound rose against the
dollar and euro on optimism Britain may soon ease a month-long
lockdown.
The BOJ's decision to remove limits on its government bond
purchases and increase corporate debt buying was widely expected
and puts it in line with other major central banks that have
unleashed unprecedented amounts of monetary support
Traders now shift their focus to a U.S. Federal Reserve
meeting ending Wednesday and a European Central Bank (ECB)
meeting on Thursday as major central banks once again take the
stage as the global economy battles against a deep depression.
The Fed has already announced a raft of measures and is
expected to stay on hold this week, which is unlikely to trouble
the dollar, analysts say.
The stakes are higher for the euro, because the ECB is
likely to extend its debt purchases to include junk bonds, and
some investors are worried this decision could widen rifts
between members of the European Union.
"It will be difficult for markets to latch onto the BOJ,
because it has already reached the limit of what it can do,"
said Takuya Kanda, general manager of the research department at
Gaitame.com Research Institute in Tokyo.
"Every economy is suffering and all major central banks have
already eased policy a lot, so it's difficult to differentiate
from one currency to the next."
The yen JPY=EBS edged up to 107.28 per dollar on Monday.
Against the euro, the yen EURJPY= traded at 116.36, close
to its strongest in three years against the common currency.
The BOJ previously had a loose pledge to buy government debt
so holdings increase by around 80 trillion yen ($745.30 billion)
a year.
The BOJ's decision to remove this guidance at a policy
meeting on Monday was largely symbolic, because actual bond
buying has slowed to an annual pace of less than 20 trillion yen
due to the central bank's outsized presence in the market.
The BOJ also said it would increase purchases of corporate
bonds and commercial paper as companies struggle with lost
revenue.
Japan, like most major economies, has urged businesses to
close and encouraged people to stay at home to slow coronavirus
infections, which is causing a widespread downturn.
The pound GBP=D3 rose against the dollar and the euro on
speculation Britain will ease its lockdown as early as this week
as Prime Minister Boris Johnson returns to work after recovering
from the illness caused by the coronavirus, the Telegraph
reported. Against the euro EURGBP= , the pound rose to 87.20 pence.
Johnson is due back at work on Monday after recovering from
COVID-19, the illness caused by the coronavirus.
The antipodean currencies were buoyed as investors
acknowledged the success both countries have had in emerging
from the coronavirus pandemic.
The Australian dollar AUD=D3 jumped 1% to $0.6462 as more
than a million Australians rushed to download an app to help
trace close contacts of COVID-19 patients. The New Zealand dollar NZD=D3 gained 0.85% to $0.6070
before its strict lockdown is eased on Monday at midnight.
The Aussie AUDJPY= and kiwi NZDJPY= also managed to gain
against the Japanese currency.
In Europe and the United States, officials are also moving
to ease some restrictions put in place when the pandemic first
occurred.
However, some currency traders say they remain wary because
threats posed by the virus have not been eliminated completely.
The dollar has risen in recent weeks due to a dollar funding
crunch and safe-haven inflows, but some analysts say the
greenback is likely to fall in the long term because the Fed has
eased monetary policy more aggressively than other central
banks.
The euro EUR=EBS rose to $1.0844 on Monday.
The ECB is under more pressure to act this week after EU
policymakers last week failed to reach a consensus on the
details of a 1 trillion euro emergency fund. = 107.3400 yen)

(Editing by Richard Pullin and Jacqueline Wong)