The yen fell against the US dollar to a lower range of 155 on Thursday in Tokyo after another alleged yen buying intervention by Japanese authorities sent the currency to 153 overnight, business agency Kyodo News reported on May 2.
The yen lost some of its gains as Japanese importers bought dollars, traders said. The yen hovered around the upper 157 zone before the authorities carried out a new undisclosed operation to stop the yen from falling for the second time this week.
The latest move follows proposed intervention on Monday after the yen fell to 160 against the dollar, hitting a new 34-year low.
“Since there is no other major news (that could affect the currency market) and the yen is the only currency that is rapidly strengthening against the dollar, it is natural to assume that intervention has occurred.”said Yukio Ishizuki, senior currency strategist at Daiwa.
The yen’s latest rise comes after the US Federal Reserve decided on Wednesday to keep its benchmark interest rate stable as expected. Federal Reserve Chairman Jerome Powell said that “It is unlikely that the next political step will be an increase”although some suggested it could hint at a rate hike amid persistent inflation.
“Powell’s comments were not as combative as some expected.”“Ishizuki said, noting that the yen had already risen against the dollar before the possible yen-buying intervention.
“The proposed intervention this time indicates that (Japanese authorities) can intervene at any time.”even if the yen does not depreciate sharply against the dollar, he added.
At 4 pm, the dollar was trading at 155.42-45 yen, compared with 154.55-65 yen in New York and 157.88-90 yen in Tokyo at 5 pm on Wednesday.
The euro was trading at $1.0716-0720 and 166.57-64 yen against $1.0708-0718 and 165.44-54 yen in New York and at $1.0661-0662 and 168.32-36 yen. in Tokyo late Wednesday.
Source: Rossa Primavera
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