US Data Boosts Dollar, Lifts Yields

8 Jan 2025 , 10:19 AM

The yen fell near levels that prompted intervention last year after solid U.S. data caused rates to soar and reduced some bets on Federal Reserve rate reduction, while the dollar held firm on Wednesday.

The yen last traded at 158.15 after reaching its lowest level against the dollar in almost six months, 158.42, overnight.

A day earlier, as the currency rate approaches the 160 level that prompted dollar selling six months ago, Japan Finance Minister Katsunobu Kato had issued a warning against speculative yen sellng.

Early in the Asian day, the euro was trading at $1.0345 after dropping roughly 0.5% overnight. Additionally, Sterling dropped and purchased $1.2478. After plunging to a 16-month low earlier in the week, the Chinese yuan was expected to enter the onshore session under pressure.

Investors are keeping a close watch on Friday’s U.S. labor data and January 20, the day of Donald Trump’s inauguration, when he is anticipated to make a number of executive orders and policy statements to start his second term as president.

A measure of input costs touched a two-year high in December, indicating a potential inflation warning, but U.S. job vacancies unexpectedly increased in November and layoffs were minimal, according to overnight data.

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