The U.S. dollar briefly hit a six-year high above 110 yen Wednesday in Tokyo on views that the diverging monetary policy outlooks of the central banks of the United States and Japan would lead to wider interest rate gaps between the two countries.
At 5 p.m., the dollar bought 109.84-86 yen compared with 109.55-65 yen in New York and 109.41-42 yen in Tokyo at 5 p.m. Tuesday. It moved between 109.60 yen and 110.09 yen, the highest since August 2008, during the day and changed hands most frequently at 109.90 yen.
The euro was quoted at $1.2595-2596 and 138.35-39 yen against $1.2626-2636 and 138.45-55 yen in New York and $1.2684-2686 and 138.78-82 yen in Tokyo late Tuesday afternoon.
The yen fell against the U.S. currency as the Bank of Japan’s Tankan business sentiment report released in the morning suggested the country’s economy may need additional easing measures by the central bank.
Confidence among major nonmanufacturers dropped from the BOJ’s last survey three months earlier, still reeling from a consumption tax hike in April, while large manufacturers unexpectedly grew optimistic by a small margin.
But the dollar’s rise took a breather as traders awaited the release of U.S. job data later in the week for signs the Federal Reserve will raise its key interest rate sooner than previously thought, dealers said.
via Mainichi
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