Dollar Plunges below 156.50 Yen Briefly in Tokyo

Tokyo, Sept. 3 (Jiji Press)–The dollar plunged below 156.50 yen briefly in Tokyo trading Thursday, the lowest level since Aug. 3, amid expectations that the Bank of Japan will accelerate interest rate hikes. The dollar stood at 157.03-06 yen at 5 p.m., down from 159.69-69 yen at the same time Wednesday. BOJ policymaker Hajime Takata said at a news conference Wednesday that the Japanese central bank had been raising interest rates at a pace of two hikes a year through 2025, but 2026 represents the start of a new phase. Market players increasingly bought yen for dollars as Takata’s remarks prompted them to expect that the pace of the BOJ’s interest rate hikes will accelerate. Also, John Williams, president of the Federal Reserve Bank of New York, expressed caution regarding interest rate hikes Wednesday, leading to a decline in expectations for an early U.S. rate hike. Dollar selling against the yen intensified also because of a pause in a rise in Japan’s long-term interest rates, which hit a 30-year high Wednesday, amid lower U.S. interest rates. “Confidence in the dollar has weakened on concerns over the worsening U.S. fiscal situation,” a Japanese bank official said. “The probability has decreased that the dollar will rise above 160 yen for the time being.” END [Copyright The Jiji Press, Ltd.]