LONDON, Oct 21 — The yen was on track for its 10th straight weekly decline against the dollar today, while sterling fell as political turmoil once again gripped Britain.
An extended yen sell-off past 150 yen per dollar to 32-year lows has put markets on heightened alert for further intervention in currency markets by Tokyo.
Japanese finance minister Shunichi Suzuki said today authorities were dealing with currency speculators “strictly”, while Bank of Japan governor Haruhiko Kuroda said the central bank would closely watch the impact of currency moves.
The yen last stood at 150.71 per dollar, down 0.4 per cent on the day.
The dollar index — which tracks the greenback against six major counterparts — edged up 0.2 per cent to 113.130, as US Treasury yields climbed to new multi-year peaks amid bets on further interest rate rises despite the risks of recession.
The dollar-yen currency pair is extremely sensitive to changes in US 10-year yields, which pushed to a more than 14-year top of 4.272 per cent.
“Japan’s efforts to highlight that no particular level is being protected means there is scope for this relatively orderly grind higher in USD/JPY to continue,” currency analysts at MUFG said in a note.
Sterling was also on the back foot, falling 0.8 per cent to a weekly low of US$1.11535 as Britain’s ruling Conservative party began scrambling to pick the country’s third prime minister in two months after Liz Truss quit on Thursday.
The currency had leapt as much as 1 per cent the previous day after Truss announced her departure.
The Conservatives, which hold a big majority in parliament and need not call a nationwide election for another two years, will now elect a new leader by October 28. Boris Johnson and former finance minister Rishi Sunak are the early frontrunners.
The euro fell 0.2 per cent to US$0.97705, after hitting an overnight high of US$0.98455. — Reuters