Yen stands tall, dollar finds floor ahead of US inflation
yen steadied near a one-week high on Tuesday as comments from Japan's top central banker on a possible end to its negative interest rate policy reverberated through markets, while the dollar regained some lost ground.
Bank of Japan (BOJ) Governor Kazuo Ueda told a newspaper interview over the weekend the bank could get enough data by year-end to determine whether it can end negative rates, remarks that on Monday saw the yen clock its largest daily gain against the dollar in two months.
The Japanese currency was last marginally lower at 146.61 per dollar, after scaling a one-week top of 145.91 in the previous session.
«Essentially, Governor Ueda laid out a conditional path and timeframe for the first-rate hike and a move away from its negative interest rate policy, should the data permit,» said Chris Weston, head of research at Pepperstone.
«One can assume that the BOJ are also one step closer to moving away from yield curve control (YCC), and logically one could argue that the BOJ would like to be able to lift rates and remove YCC concurrently.»
The yen has come under immense pressure against the dollar as a result of growing interest rate differentials with the United States, since the Federal Reserve began its aggressive rate-hike cycle last year while the BOJ remains a dovish outlier.
Elsewhere, the U.S.
dollar reversed some of its close to 0.5% loss against a basket of currencies on Monday.
The Aussie was last 0.12% lower at $0.6423 while the New Zealand dollar fell 0.14% to $0.5911, having been among the biggest beneficiaries against a weaker greenback on Monday and gaining 0.8% and 0.6%, respectively.
The euro, however, touched a one-week high of $1.0771.
«Given the fact that we've also had pretty strong momentum
