The dollar headed for a six-week advance against the yen, the longest rally this year, as the Federal Reserve moves closer to raising interest rates while the Bank of Japan maintains monetary easing.
A gauge of the U.S. currency versus major peers was set to climb for a fifth week and Treasury yields climbed after the Fed raised its target interest-rate forecast this week. The yen fell against most of its counterparts after BOJ Governor Haruhiko Kuroda said easing will continue until inflation stabilizes at 2 percent. The pound gained to a two-week high as a YouGov Plc poll showed Scotland probably voted against independence.
“It’s less a yen story and more a dollar story, and that’s why we’re likely to see broad-based U.S. dollar strength,” said Su-Lin Ong, head of Australian economic and fixed-income strategy at Royal Bank of Canada in Sydney. The question is: “are we at a bit of a turning point in terms of Fed policy and U.S. yields?” she said.