TOKYO: The yen extended its advance past the psychological level of 140 against the US dollar amid threats to the independence of the Federal Reserve (Fed), heightened risks concerning tariffs and ahead of a meeting between the finance chiefs of Japan and the United States.
Japan’s currency rose as much as 0.7% to 139.93 against the dollar, its strongest level since September.
The move came after the currency had paused just before 140, where some traders were defending options positions. The yen was the best performer among its Group-of-10 peers against the dollar yesterday.
The move came as Trump’s trade war boosted demand for havens and led to selling of US assets.
He was also contemplating the possibility of firing Fed chairman Jerome Powell, adding to dollar weakness.
The Wall Street Journal reported that Trump was laying the groundwork to blame the Fed for the economic fallout from the trade war if the central bank doesn’t cut rates soon.
Speculative traders became most bullish on the yen on record last week, according to data from the Commodity Futures Trading Commission as of April 15. — Bloomberg
