In the currency market, the dollar weakened slightly against the yen as investors kept a close eye on signs of potential Japanese intervention. Meanwhile, the Australian dollar saw gains after the Reserve Bank of Australia (RBA) decided to maintain interest rates at 4.1 percent. The RBA stated that it needed more time to evaluate the impact of previous rate hikes, but also hinted at the possibility of further tightening to control inflation.
The dollar-yen exchange rate fell by 0.19 percent to 144.45 yen, after experiencing a 0.27 percent increase the previous day. Despite the decline, the yen remained near its eight-month low against the dollar, which prompted Japan’s Finance Minister, Shunichi Suzuki, to caution against excessive selling of the currency. On the other hand, the Australian dollar rose by 0.13 percent to $0.668.
Market activity was relatively subdued due to the public holiday in the United States. Investors are also awaiting the release of the U.S. non-farm payrolls employment report later this week, which is expected to impact the Federal Reserve’s future decisions.
In other currency news, the euro was down 0.13 percent against the dollar at $1.09, while the pound sterling remained relatively stable at $1.269. The U.S. dollar index, which measures the dollar against major currencies, remained unchanged at 103.
In terms of possible intervention, Japanese authorities are closely monitoring the yen’s depreciation. Japan’s top financial diplomat, Masato Kanda, stated that officials are in constant contact with overseas authorities to discuss currencies and broader financial markets. Analysts believe that coordinated intervention may be on the horizon if the yen continues to hover above 144 per dollar.
Looking ahead, RBC Capital Markets’ Alvin Tan predicts that the dollar is likely to rise past 150 yen. This, coupled with Japan’s reluctance to deviate from its current ultra-loose policy, increases the likelihood of intervention.
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Denial of responsibility! Vigour Times is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
