FILE PHOTO: Illustration shows Japanese Yen and U.S. dollar banknotes
(Reuters) – The yen weakened on Monday to its weakest levels against the dollar since June 1990, with markets alert to any signs of intervention from the Japanese authorities to prop up the yen.
The decline in the yen comes after a string of strong U.S. inflation data pushed the dollar to five-month highs and reinforced expectations that the Federal Reserve is unlikely to be in a rush to cut interest rates this year.
The yen’s slide against the dollar has revived anticipation of currency intervention. Japanese Finance Minister Shunichi Suzuki and other policymakers have said they are watching currency moves closely and will respond as needed.
The strong dollar prevailed at last week’s International Monetary Fund/World Bank spring meetings in Washington too, and the United States, Japan and South Korea issued a rare joint statement on the issue.
Speaking after the Group of 20 (G20) finance leaders’ meeting in Washington, Bank of Japan Governor Kazuo Ueda said the Japanese central bank may raise interest rates again if the yen’s declines significantly push up inflation, highlighting the dilemma the weak currency has become for policymakers.
The dollar was last up 0.13% at 154.82 yen, its strongest since June 1990.
(Reporting by Gertrude Chavez)
About the Author
