US dollar down, yen stuck near the lowest level in 3 decades

The battered yen was stuck near a three-decade low against the dollar on Tuesday and was struggling to stem its losses as the Bank of Japan’s ultra-loose monetary policy continued to conflict with expectations of interest rates remaining high for longer periods elsewhere. .

According to Reuters, the Japanese currency recorded its lowest level in 15 years against the euro at 162.38 yen to the euro at the beginning of Asian trading, and it also fell to the lowest level in almost three months against the British pound at 186.25 yen to the pound.

Against the dollar, the yen recorded in the latest transactions 151.70 to the dollar, remaining near the lowest level in a year at 151.92, which it recorded on Monday. Recording any decline from the yen’s lowest level last year at 151.94 to the dollar would record a new record low in 33 years.

In September last year, the Japanese authorities intervened in the currency market to support the yen for the first time since 1998, after the Bank of Japan’s decision to maintain its very loose monetary policy led to the yen falling to 145 to the dollar.

It intervened again in October 2022 after the yen fell to a 32-year low of 151.94 to the dollar.

Outside Asia, traders are also awaiting US inflation data scheduled to be released later on Tuesday, which will provide more clarity on whether the Federal Reserve (the US central bank) will need to raise interest rates further to tame inflation.

In recent days, Bank President Jerome Powell and his monetary policy-making team have contradicted market expectations that the US Federal Reserve has ended its harsh cycle of raising interest rates after keeping interest rates steady at the last monetary policy meeting.