Dollar firms, yen weakens to intervention-wary level
By Ankur Banerjee
SINGAPORE (Reuters) — The dollar was firm on Thursday, hovering near a one-week high as Treasury yields rose and investor appetite for riskier currencies dimmed, while the yen breached 150 per dollar to keep traders jittery about the prospect of intervention.
The Japanese yen touched a fresh one-year low of 150.32 per dollar overnight and was last at 150.26.
Japanese finance minister Shunichi Suzuki warned investors against selling the yen again on Thursday, saying authorities were closely watching moves. «I'm watching market moves with a sense of urgency, as before,» he told reporters at his ministry.
The closely watched 150 threshold is perceived by investors as a danger zone that may trigger intervention from Japanese authorities. Suzuki made no direct comment about the potential for intervention.
U.S. GDP data due later on Thursday is a key event risk for dollar/yen, according to Carol Kong, currency strategist at Commonwealth Bank of Australia (OTC:CMWAY), who said a strong report may pressure U.S yields higher and result in the yen testing fresh lows.
A recent surge in global interest rates is heightening pressure on the Bank of Japan to change its bond yield control next week. A hike to an existing yield cap set three months ago being discussed as a possibility, sources have told Reuters
The Australian dollar slid to an 11-month low of $0.6276 and was last down 0.35% at $0.6287. A surprisingly high reading for inflation on Wednesday stoked expectations of a further hike in interest rates.
The New Zealand dollar also touched an 11-month low of $0.5780 and was last down 0.22% at $0.5788.
Benchmark U.S. 10-year Treasury yields inched higher, resuming a move toward a 16-year peak of 5.0% briefly
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