USD/JPY at 103 After Record Trade Gap

The yen dropped versus its 16 major peers after data showed the nation reported its biggest trade deficit on record, eroding the nation’s haven appeal.

The dollar failed to gain against the euro for a third day as investors weighed the probability that the Federal Reserve will taper bond purchases against the chance policy makers may strengthen guidance on interest rates. Australia’s dollar rose from near a four-month low after Reserve Bank Governor Glenn Stevens said that low borrowing costs are supporting higher spending in the economy.

“The yen will remain weak,” said Daisuke Karakama, a Tokyo-based market economist at Mizuho Bank Ltd. “The trade deficits are big enough to keep the currency from strengthening.”

Bloomberg

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