Yen Rises Above Y100 Versus the Dollar Again
August 17 2016 - 11:46PM
Dow Jones News
By Hiroyuki Kachi
The yen gained traction against its peers during Asian morning
trade Thursday, rising above the Y100-line versus the dollar again,
on the Federal Reserve's cautious stance in raising rates and
weakness in Tokyo stocks prompting buying of the Japanese
currency.
The greenback fell to as low as Y99.64 earlier in the session,
coming close to Y99.55 set on Tuesday--the lowest level since the
U.K.'s decision to leave the European Union in late June. Around
0250 GMT, the U.S. currency rose back above the Y100-threshold,
changing hands at Y100.10, but still below Y100.28 late Wednesday
in New York.
The euro also dropped to as low as Y112.65 before coming back to
Y113.13 midday. The common currency was at Y113.20 late Wednesday.
The pound fell to as low as Y130.02 from Y130.76.
The Fed's minutes from its July 26-27 policy meeting released
overnight showed members of the Federal Open Market Committee were
split on the timing of an interest rate hike. The minutes suggested
a rate increase is a possibility as early as September, but that
the Fed won't commit to moving until a stronger consensus can be
reached about the outlook for growth, hiring and inflation.
That dampened sentiment for some investors who were anticipating
more hawkish signals especially after Fed officials remarks earlier
this week flagging the possibility of a rate increase in
September.
Weakness in Tokyo stocks also bruised the market sentiment,
prompting buying of the perceived safety of the Japanese currency.
The Nikkei Stock Average fell 1.1% in early morning session, before
trimming losses to a 0.2% fall midday.
"I don't think investors are buying the yen aggressively," said
Marito Ueda, director at FX Prime byGMO. "To put it the other way
around, there is no reason to buy the dollar and others in a
positive manner," given the Fed's cautious stance toward raising
short-term rates and continued thin market volume due to the summer
holiday, said Mr. Ueda.
"The possibility is now even lower of Fed chair (Janet) Yellen
giving hawkish signals to smooth the way for a September rate
increase" at the Fed's Jackson Hole symposium on Aug. 26, said
Nomura Securities chief FX strategist Yunosuke Ikeda in a morning
note. He added that he expects any full-fledged dollar buying will
now be pushed back to November-December.
In other currency trade, the euro briefly hit $1.1328, its
highest since June 24 shortly after the Brexit vote, amid a broader
dollar selling. That compared with $1.1291 late Wednesday.
The WSJ Dollar Index, a measure of the dollar against a basket
of major currencies, was down 0.16% at 85.47.
Interbank Foreign Exchange Rates At 22:50 EST / 0250 GMT
Latest Previous %Chg Daily Daily %Chg
Dollar Rates Close High Low 12/31
USD/JPY Japan 100.11-12 100.27-28 -0.16 100.29 99.64 -16.77
EUR/USD Euro 1.1300-03 1.1288-91 +0.11 1.1327 1.1287 +4.06
GBP/USD U.K. 1.3052-54 1.3041-43 +0.08 1.3089 1.3037 -11.42
USD/CHF Switzerland 0.9612-16 0.9620-24 -0.08 0.9630 0.9593 -4.05
USD/CAD Canada 1.2833-38 1.2842-47 -0.07 1.2863 1.2815 -7.25
AUD/USD Australia 0.7694-98 0.7652-56 +0.55 0.7719 0.7650 +5.61
NZD/USD New Zealand 0.7277-83 0.7249-55 +0.39 0.7311 0.7250 +6.54
Euro Rate
EUR/JPY Japan 113.12-16 113.18-22 -0.05 113.24 112.67 -13.49
Source: Tullett Prebon
Write to Hiroyuki Kachi at Hiroyuki.Kachi@wsj.com
(END) Dow Jones Newswires
August 17, 2016 23:31 ET (03:31 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.