Yen retraces after rally as analysts tip further weakness
The yen retreated against the U.S. dollar Thursday, giving up strong gains from the previous session spurred by comments from the head of Japan’s central bank as analysts predicted further weakness ahead.
On Thursday, the U.S. dollar fetched 123.31 yen from 122.67 yen in New York trading. The greenback topped the 125 yen level, a 13-year high, earlier this week. Bank of Japan (BOJ) chief Haruhiko Kuroda sent the yen soaring Wednesday when he said the Japanese currency’s recent sell-off was “unlikely” to continue, even if the U.S. Federal Reserve hikes interest rates. The dollar fell to 122.70 yen from around 124.50 yen in morning trade. “Everyone was troubled with the recent plunge in the yen to the 125-level, so Kuroda’s comments became a welcome rain in the drought,” said Daisaku Ueno, chief currency strategist at Mitsubishi UFJ Morgan Stanley Securities. “But so long as the BOJ sticks to its easing stance, it’s hard to see the yen continuing to rise,” he told Bloomberg News. Capital Economics said it expects the yen “to fall a lot more.”
The euro fetched US$1.1304 and 139.49 yen, against US$1.1324 and 138.92 yen in New York. The dollar weakened against most other Asia-Pacific currencies, slipping to SG$1.3438 from SG$1.3481 on Wednesday, to 1,107.75 South Korean won from 1,111.38 won, and to 33.64 Thai baht from 33.70 baht. The greenback also eased to 63.78 Indian rupees from 63.92 rupees, and to 13,290 Indonesian rupiah from 13,310. It edged up to 44.98 Philippine pesos from 44.97 pesos.
The Australian dollar rose to 77.67 U.S. cents from 76.92 cents. The Chinese yuan bought 19.82 yen, unchanged from Wednesday.