The yen surged on Thursday, taking some of the wind out of the sails of the recently buoyant dollar and prompting investors to cover positions against a backdrop of potential event risks, including a speech by Federal Reserve chief Janet Yellen. Some market participants mentioned an interview with Masatsugu Asakawa, Japan’s vice-minister of finance for international affairs, who told the Financial Times that direct currency intervention will remain in the ministry’s toolbox. Other traders, who did not see any fresh trading catalysts, said they were forced to buy back the Japanese unit as it rapidly shot up against other currency pairs as well as the dollar.
The dollar earlier had stuck close to recent ranges, as investors looked for Yellen to provide clues on Friday as to whether a U.S. rate increase is imminent, and awaited clarity from Japan on whether it would press ahead with planned sales tax hike next year.
Underpinning the single currency, Eurogroup ministers gave Greece its firmest offer yet of debt relief, approving the release of 10.3 billion euros ($11.48 billion) in recognition of painful fiscal reforms pushed through by Prime Minister Alexis Tsipras’ leftist-led coalition.
EUR/USD: during the Asian session the pair rose to $1.1180
GBP/USD: during the Asian session the pair traded in the range of $1.4690-20
USD/JPY: during the Asian session the pair dropped to Y109.40
Based on Reuters materials
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