Dollar extends gains against yen with US economic strength in focus
dollar rose to a seven-week high against the yen on Thursday, while the sterling and euro fell amid on the U.S. economy is coming off the boil while traders watch for more data bolstering the case for a Federal Reserve rate cut this year.
May retail sales released this week were tepid and the labor market appears to be weakening. The number of Americans filing new claims for unemployment benefits fell last week, but was still more than expected, data released on Thursday showed, indicating the jobs market remained strong despite a gradual cooling.
«U.S. (purchasing managers' index) tomorrow could provide more of a catalyst for a higher volatility day, so we'll be keeping our eyes on that to wrap up the week,» said Helen Given, associate director of trading at Monex USA, in Washington.
The dollar hit its highest since April 29 against the yen and was last up 0.51% at 158.89 yen in New York trading. Traders remain on alert for signs of continued intervention by the Bank of Japan to boost a currency that hit 34-year lows in late April.
Yen markets have been rattled since a dovish Bank of Japan last week maintained its policy target and said it intends to soon release a plan to trim bond buying.
«I think the market was kind of disappointed in the Bank of Japan's actions. It felt a bit like kicking the can down the road again for the yen for the market,» said Amo Sahota, director, Klarity FX, in San Francisco.
«Well, in that case, we'll just carry on with a very simple carry trade that we've been doing. The Bank of
