USD/JPY Above 123.50

The dollar hovered at eight-year highs against the yen early on Thursday, having stopped short of breaking above its 2007 peak as it consolidated recent gains against the euro and other peers.  The greenback popped above 124.00 yen for the first time since June 2007, but lost steam after reaching 124.09, just shy of the 124.14 peak. It last traded at 123.76.

A break above the key level would take the dollar back to highs not seen since December 2002, a move that could prompt more verbal intervention from Japanese officials.  On Wednesday, Japanese policymakers cautioned markets against pushing the yen down too rapidly.

“Longer-term, little stands in the way of further JPY losses,” said Greg Moore, senior currency strategist at RBC.  The dollar, however, shed some ground against the euro amid tentative hopes that cash-strapped Greece may be nearing a deal to secure fresh funding.