USD/JPY Hits 104 After Kuroda and Yellen

The U.S. dollar stayed in the lower 104 yen zone in Tokyo on Monday, moving narrowly due to a lack of market-moving events after rising above the 104 yen line in earlier Oceanian trading on growing expectations for a U.S. interest rate hike amid signs of economic recovery.

At 5 p.m., the dollar fetched 104.12-14 yen compared with 103.88-98 yen in New York and 103.76-77 yen in Tokyo at 5 p.m. Friday. It moved between 104.09 yen and 104.27 yen during the day, changing hands most frequently at 104.18 yen.

The euro was quoted at $1.3186-3191 and 137.32-36 yen against $1.3235-3245 and 137.53-63 yen in New York and $1.3286-3288 and 137.86-90 yen in Tokyo late Friday afternoon.

The dollar gained to the 104 yen level as Fed Chair Janet Yellen’s speech Friday at an annual symposium of policymakers at Jackson Hole, Wyoming, stoked bets for an earlier-than-expected rate hike, said Shinichiro Kadota, foreign exchange strategist at Barclays Bank.

“Yellen has generally been seen as quite dovish among Fed members, but her message now is a very balanced one — that as soon as economic indicators pick up, we can expect a rate hike — and this has driven demand for the dollar,” Kadota said.

This week brings relatively little fresh U.S. events and is sandwiched between the major events of Jackson Hole and next week’s monthly U.S. jobs data release.

via Mainichi

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza