Greenback stands tall driven by Fed minutes
On Thursday, the evergreen buck kept to its three-week peak against the Japanese yen after the Fed’s minutes sparked expectations for a fresh interest rate hike in June.
The greenback surged to 110.27 yen – the strongest value since April 28, generating a revenue of almost 4.5% from an 18-month minimum of 105.55 yen in May.
Later the greenback came off that peak and last hung around 110.05 yen, showing a 0.1% dip on the day.
While the US dollar could see further revenues against the Japanese yen in the nearer future, the overall pace will probably become more gradual given the potential for greenback-selling by Japanese exporters, as some financial analysts state.
No one doubts that these levels are getting more attractive for exporters when it comes to conducting some currency hedging.
A number of key Japanese exporters have already set their greenback/yen exchange rate assumptions for 2016/17 business year at the levels 110-105 yen. By the way, this business year starts in April.