During Monday’s Asia trade the greenback went down, because market participants expect the Fed to maintain its cautious position as for interest rate hikes.
The US dollar traded at ¥111.38. Since March 21, the financial world hasen’t seen such a low.
Furhtermore, the major American currency kept demonstrating a downbeat tone agaisnt the yen notwithstanding quite positie readings in March’s US jobs data and ISM manufacturing index for the same month.
Currency market dealers as well as analysts in Tokyo told that the greenback’s downward momentum was mostly driven by traders’ bets that the major American bank would be quite cautious regarding rate hikes in 2016, right after Yellen’s recent dovish statement suggesting there was little appetite to increase rates in April.
Furthemore, lower crude prices and recent decline in Tokyo shares bruised market sentiment, thus driving safe-haven demand for the major Japanese currency. The Nikkei Stock Average closed -0.6% in the afternoon.
In her last week’s speech Yellen informed that slower growth abroad suspended risk to American economy, thus justifying a moderate path for interest-rate hikes.