HONG KONG, June 13 — The yen fell to a fresh 20-year low against the dollar today, as red hot US inflation data drove up Treasury yields, diminishing the boost it got from speculation Japanese authorities could intervene to support the currency.
The dollar climbed 0.43 per cent today to ¥135, a 20-year peak, and edging closer to the 2002 high of 135.20.
The yen briefly rallied late on Friday when Japan’s government and central bank said they were concerned by its recent sharp falls, a rare joint statement seen as the strongest warning to date that Tokyo could intervene to support the currency.
“Rising overseas yields and energy prices coupled with continued dovish Bank of Japan messages have pushed USDJPY to two-decade highs,” said Barclays analysts.
They expect dollar/yen to trade between 131 and 136 this week and noted “there are no clear thresholds above (the 2002 high) other than the round figures of 136, 137 and 138.”
The benchmark US 10-year yield touched 3.2 per cent this morning, having gained nearly 12 basis points on Friday after US inflation beat expectations, driving bets that the Fed will have to hike rates even more aggressively. — Reuters
