The dollar hit a one-month high against the yen on Monday and stood tall against other peers after comments by Federal Reserve Chair Janet Yellen enhanced the prospects of a near-term U.S. interest rate hike. In addition to the latest round of hawkish-sounding comments from Yellen, political developments in Tokyo were also seen supporting the dollar against the yen. Japanese Prime Minister Shinzo Abe said he would delay a sales tax hike scheduled for next April by two and a half years, a senior ruling party official said after a meeting with the premier on Monday.
Japan is also seen compiling a supplementary budget to boost the sputtering economy, a move which is widely expected to be followed by further monetary easing by the Bank of Japan.
Yellen’s rate hike endorsement was just what the currency market was looking for to take the already-bullish dollar yet higher after a recent run of upbeat U.S. economic indicators and comments from top Fed officials that supported a near-term tightening.
EUR/USD: during the Asian session the pair fell to $1.1095
GBP/USD: during the Asian session the pair traded in the range of $1.4595-25
USD/JPY: during the Asian session the pair rose to Y111.20
Based on Reuters materials
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