The dollar hovered near its highest level in seven and a half months against the yen after the statements of the chiefs of the US and Japanese central banks confirmed the significant difference in the course of monetary policy for each of them, during a conference hosted by the European Central Bank last night.
US Federal Reserve Chairman Jerome Powell said in one of the conference committees, in the presence of European Central Bank President Christine Lagarde, Bank of Japan Governor Kazuo Ueda and Bank of England Governor Andrew Bailey, that interest rates are likely to be raised twice more this year, and he did not rule out the possibility of raising interest rates in July.
In contrast, Ueda reiterated that there is still a way to go from achieving a sustainable rate of inflation of 2% accompanied by sufficient wage growth, the two conditions set by the Bank of Japan to consider ending its ultra-loose monetary policy.
The dollar has jumped 11.55% since late March, hitting 144.62 yen on Wednesday, for the first time since November 10, prompting verbal warnings from Japanese government officials this week that the move may be too fast.
The Ministry of Finance and the Bank of Japan intervened in the currency market last fall when the dollar rose above 145 yen.
The dollar reached 144.265 yen in early Asian trade on Thursday.
There was little change in the dollar index, which measures the performance of the US currency against six other major currencies, including the yen, the euro and the pound sterling, to record 102.94 after rising 0.46% overnight.
The euro settled at $1.09125, after falling 0.45% on Wednesday. Sterling rose 0.07% to $1.6445, recovering some of the 0.88% losses from the previous session.
The Australian dollar rose in the latest transaction 0.3% to $ 0.66205, recovering some of its recovery after falling 1.27% yesterday.
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