The yen fell more than half a
percent to 13-month lows beyond the key 120 level versus the
dollar on Thursday on jitters about Japan's rate outlook, while
the euro rose ahead of an expected no-change euro zone rate
decision.
Investors were speculating the Bank of Japan will raise
interest rates by a quarter point to 0.5 percent next week but
analysts said the market is starting to have doubts about the
likelihood of a hike, and about the strength of the Japanese
economy. ...
"The price action suggests markets are backing away from a
rate hike in Japan next week," said Steven Saywell, chief
currency strategist at Citigroup. ...
But the yen's fall largely stalled on Thursday after
Japanese Vice Finance Minister Hideto Fujii said disorderly
moves in the currency market were undesirable.
"The market is coming round to the idea that the BOJ may not
raise rates on Jan. 18, and if they do, the conditions do not
really warrant it and the rate rise is going to be the last for
some time," said Derek Halpenny, currency economist at BTM-UFJ.
