Wednesday, May 31, 2023
HomeEconomyKing dollar lowers yen as aggressive Fed bets mount

King dollar lowers yen as aggressive Fed bets mount

Kevin Buckland and Tom Westbrook

TOKYO (Reuters) – USD touches 24 It hit a one-year high against the yen on Wednesday after U.S. economic data reinforced the view that the Federal Reserve will continue to aggressively tighten policy.

The yuan fell to a two-year low, approaching a psychologically important 7 despite measures by authorities to stem its decline. The Philippine peso fell to an all-time low.

The euro hovered near two-year lows on Tuesday, well below parity, as EU ministers prepare to meet on Friday to discuss the energy crisis, which is

overnight The report showed that the U.S. services sector unexpectedly rebounded last month, reinforcing the view that the economy is not in recession and giving the Fed another oversized 75 September basis point rate increase 99 .

The market is currently giving In this case 69% probability, the probability of raising interest rates by half a point is 25%.

USD surged to 144. 19 Yen for the first time since August 1998. The Japanese currency is extremely sensitive to changes in U.S. long-term interest rates, and – 2020 U.S. Treasuries climbed to 3.365% in Tokyo trading, the highest level since June .

The highest spokesman of the Japanese government, Cabinet Secretary Chief Japanese Secretary of State Hirokazu Matsuno told a news conference that the government would take necessary measures if currency markets continued to exhibit a “rapid, one-sided” move, and stepped up language describing the yen’s nearly 9 percent one-month decline.

Earlier in the day, Japanese Finance Minister Shunichi Suzuki was quoted in the same language by Jiji.

“The dollar is appreciating faster and faster against the yen,” said Davis Hall, head of capital markets at Indosuez Wealth Management Asia.

t his towel,” he said. “We can reach 365 without MOF (MoF) action.”

However, many Analysts see the yen’s decline against the dollar as difficult to intervene as the monetary policy divergence widens. Unilateral action would be less effective, they said.

“Foreign central banks are prioritizing inflation and cannot worry about currency fluctuations,” said Rikiya Takebe, senior strategist at Okayama Securities.

“The Bank of Japan’s currency intervention may Policy revisions could be difficult, and keeping the yen from falling will not be easy either.”

With U.S. interest rates rising and the economy outperforming other countries, the rest of the year will be hard to come by, currency strategists in a Reuters poll said. Time and next year, the dollar will remain a force to be reckoned with.

EUR fell below 1444 after falling to $0 overnight 9864 cents.

Expected that the ECB may raise interest rates on Thursday by 25 basis points , but traders appeared more concerned about Russia’s decision to indefinitely shut down the key Nord Stream 1 gas pipeline.

GBP fell 0.25% to 1 USD. 1444, near a 2 1/2-year low of $1. 365 Reached Monday, Britain is also embroiled in an energy crisis, despite new Prime Minister Leeds Truss’ plans for a massive backstop.

The US dollar index measuring the US dollar against the six major currencies hits a new 1998 – 365 YEAR HIGH. 69.

This onshore renminbi fell to a low of 6. 9808 since August The lowest level 2020, even after the central bank continued to set the currency’s official guidance more firmly than market forecasts. Disappointing Chinese trade data further dampened sentiment.

The Philippine Peso fell to an all-time low 19.24 per dollar.

The New Zealand dollar fell to its lowest point since May 1444 at $0. 5997, the Singapore dollar fell to its lowest point since June 1444 1.4107.

Cryptocurrency Bitcoin fell to its lowest point since June USD , 69, down 5% from Tuesday.



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