The dollar rose Thursday above 120 yen for the first time in more than seven years, boosted by US economic optimism while Japanese stimulus weighed heavily on the yen.
At about 1420 GMT, the US currency climbed to 120.17 yen, its highest level since July 26, 2007, before easing back to stand at 119.90 yen.
"It’s unsurprising ... that the dollar has breached the 120 mark against the yen today," Spreadex trader Connor Campbell told AFP.
"Bar a few wobbles, like an oil-inspired dip last week, the dollar has been incredibly strong since the dual boost of the Bank of Japan (BoJ) beginning QE (quantitative easing) just as the US Federal Reserve announced it was ending its similar programme."
He added: "Combine this with the uncertainty for any currency approaching an election, and a perfect storm was created, a storm that the dollar took full advantage of."
At the same time, the dollar has also benefited from growing confidence in the strength of the US economic recovery.
Forex.com analyst Fawad Razaqzada predicted the greenback could surge even higher, given the policy divergence between the US and Japanese central banks.
"The dollar/yen could go further higher once profit-taking around the key 120 level fades," he told AFP.
"With the BoJ continuing to loosen policy and the Fed tightening, I would not be surprised if it were to reach the 2007 peak of around 124 before the year-end."
The BoJ surprised global financial markets on October 31 by announcing it would inflate its asset-buying plan by up to 80 trillion yen ($676 billion) annually.
The decision, which came days after the Federal Reserve wound down its own stimulus, subsequently sent the yen plunging to a series of multi-year lows against both the dollar and euro.
"The question is not what is pushing the dollar towards and beyond the 120 yen barrier -- but why it hasn’t gone through this level sooner," added analyst Rebecca O'Keeffe at online brokerage Interactive Investor.
"The end of QE in the US, combined with the vast quantity of money that the Bank of Japan continues to pump into the market, has made the yen a one-way bet and there appears little to prevent it from weakening further."
GMT 11:02 2018 Tuesday ,11 December
ASE opens trading on lower noteGMT 15:40 2018 Monday ,10 December
Amman stock market closes trading at JD4.4 millionGMT 19:10 2018 Wednesday ,05 December
Index at Palestine stock market drops by less than one pointGMT 17:58 2018 Sunday ,25 November
Amman stock market wraps up trading at JD2.6 millionGMT 14:24 2018 Thursday ,22 November
Russia’s stock market demonstrates record-breaking figures in 2018GMT 11:45 2018 Tuesday ,20 November
Tokyo stocks close lower as tech issues weigh, Nissan tumblesGMT 15:08 2018 Monday ,19 November
Amman stock market wraps up trading at JD6.1 millionGMT 15:51 2018 Sunday ,18 November
U.S. stocks post weekly losses amid tech shares routMaintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©
Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©
Send your comments
Your comment as a visitor