USD Rises Against JPY as Government Threatens Intervention

The dollar rose Tuesday to its highest level against the yen in two weeks after Japan’s finance minister said warnings from U.S. Treasury officials wouldn’t stop Japan from trying to weaken its currency by selling yen in the open market.

One dollar USDJPY, +0.74%  bought ¥109.05 in recent trade, up 0.6% from ¥108.40 late Monday in New York. That represented the U.S. currency’s strongest level against its Japanese rival since April 28, the day the Bank of Japan surprised investors by leaving its monetary policy virtually unchanged, driving the yen to its largest one-day gain in seven years.

The ICE U.S. Dollar index DXY, -0.01% a measure of the greenback’s strength against a basket of six rival currencies, was on track to rise for a sixth straight day as weak industrial-production data out of Germany helped weighed on the euro. The index was up 0.1% at 94.2270, also its strongest level since April 28.

The shared currency EURUSD, -0.0088%  traded at $1.1376, compared with $1.1387 late Monday in New York.

Speaking before Japanese lawmakers, Taro Aso, Japan’s finance minister, said it would be “natural” for the government to intervene in the markets if the yen keeps logging “one-sided” gains.

via MarketWatch

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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