Rise in regional U.S. business helps Dollar match 3-mth high vs. yen
Just before the meeting of the Group of Eight finance ministers in Potsdam, Germany, which is scheduled to start later today, the low-cost Japanese Yen continued to get weaker close to a record low against the Euro.
In Tokyo today, the U.S dollar rose again to match up the preceding session’s three-month high against the Japanese yen. According to the data, the reason behind this high is said to be the strong growth in regional U.S. business activities, with the viewpoint that the U.S. rate of interests will stay in a state of uncertainty for a while.
An investor for one of the biggest Japanese Banks said that the atmosphere in the currency market appears to be that for trying to achieve new highs in the U.S dollar.Â
Also stated by the investor was the speculation that the by the end of May this year, the U.S dollar may rise above and beyond a four-year high of 122.21 Japanese Yen that it hit in the month of January, to a higher position of about 122.51 yenÂ
At about 0210 GMT, the U.S dollar stood at 121.31 Japanese yen, after mounting as high as 121.36 Japanese yen on internet, or the electronic trading platform, easily matching a hit which the dollar moved yesterday, a hit which was the peak since the late February this year.
Seeing this movement in the currency market, most traders were of the opinion that this U.S dollar rise could be raged by profit-taking. They also said that the Japanese exporters may also settle on selling the U.S dollar now in order to take full advantage of this rise.
The euro was stable at $1.3491 but fixed near about a one-month low down of $1.3461 hit which it faced late last week. Although in opposition to the Yen, the Euro moved a little at 163.64 yen, fixing near a high of 163.91 yen which was hit previously this week.
For the G8 meeting later today, a senior U.S. Treasury official had said earlier this week that no debate about currency rates was anticipated at the meeting.
While concern and watchfulness was being felt prior to the G8 meeting this weekend, investors were of the opinion that the gathering, it appeared, was doubtful to generate much news which could shock the exchange markets.
The main reason for their doubts was the absence of Henry Paulson, U.S. Treasury Secretary, who is said to be skipping the event.