Yen Heads for Biggest Weekly Drop Since May Despite Tokyo's Support Pledges
Traders watched Tokyo for signs of intervention as markets priced a 25 basis point BOJ hike this year and rising oil prices supported the dollar.
- On Thursday, the dollar eased from a one-week high as the yen recovered slightly from a nearly four-decade low, with traders weighing potential intervention from Tokyo and Bank of Japan rate hikes.
- Rising oil prices and U.S. Treasury yields hoisted the dollar, driven by heightened tensions in the Iran war and threats by Iran-aligned Houthis in Yemen against Red Sea energy routes.
- According to CME FedWatch, markets price in a 31.5% chance for a Federal Reserve rate hike, up from 10.7% last week, as Juan Perez of Monex USA noted ongoing negotiations.
- Finance Minister Satsuki Katayama warned authorities would take "decisive action" to curb excessive currency weakness, while the BOJ remains on alert for inflation risks that could force faster rate hikes.
- Mallika Sachdeva of Deutsche Bank Research noted the ultimate impact "will depend on the levers the government chooses to pull," including Government Pension Investment Fund mandates.
18 Articles
18 Articles
The Economic Times
Business TimesYen heads for biggest weekly drop since May despite Tokyo's support pledges
The Japanese yen is experiencing a dramatic drop, marking its most significant weekly decline since May. The currency has hit 40-year lows against the US dollar, compounded by Japan's ineffective measures to bolster its value. Additionally, surging oil prices have reignited inflation worries, further enhancing the dollar's strength, while the euro and sterling have seen slight increases against it.
US warns against excessive yen volatility, calls for BOJ rate hikes
By Leika Kihara TOKYO, July 24 (Reuters) - The U.S. Treasury Department said yen weakness has persisted despite the narrowing of U.S.-Japan interest rate differentials, warning excess volatility in the currency was undesirable. The Treasury also calle...
The New York Ledger
FXStreetJapanese Yen strengthens on BoJ hawkish signals, intervention risks
The USD/JPY pair edges lower to near 163.10 during the early Asian session on Thursday. However, the Japanese Yen (JPY) remains near a four-decade low as fiscal concerns weigh on the domestic currency. Traders are on high alert for possible intervention from Japanese authorities. The Bank of Japan (BoJ) signaled a potential shift away from its ultra-loose monetary policy, with officials hinting at possible rate normalization. Hawkish rhetoric f…
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