LONDON, June 13 (Reuters) – The asylum dollar rose to two-decade high against major rival currencies on Monday, backed by fears of a slowdown in the global economy and bets on a sharp rise in US Federal Reserve interest rates.
The yen was among many currencies that fell to its lowest level against the dollar since 1998 as the gap between the Japanese and US reference yields widened after hot data on Friday’s inflation in the United States. Read more
The sale of the markets led to a decline in European stocks for the fifth consecutive session, while bitcoin fell 9% to an 18-month low of about $ 24,000. Read more
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The dollar index – which tracks greenbacks against six major competitors – rose 0.5 percent during the day to 104.75, near the two-decade peak of 105.01 in May. The latter increased by 0.2% to 104.63.
Central banks’ efforts to curb uncontrollable inflation will remain in focus this week.
The Federal Reserve and the Bank of England are expected to raise interest rates on their meetings, and the Swiss National Bank has a chance to do the same.
The Bank of Japan (BoJ) has so far resisted pressure to tighten policy, weakening the country’s currency. The policy gap has depreciated the yen by more than 15% against the dollar since early March.
The yen fell 0.6 percent during the day to 135.22 yen per dollar, its lowest level since 1998. It was last at 134.37 yen per dollar.
On Monday, a senior Japanese government spokesman said Tokyo was ready to “respond appropriately” if necessary. Read more
“Overall, fundamental changes continue to favor the yen’s continued weakness in the short term, but market participants will be more cautious about the risk of intervention and / or hawkish change in BoJ policy next week,” MUFG currency analysts said. in Note.
Downward pressure on the yen may encourage speculation of a return to the yen’s weakness, unseen by the 1997 Asian financial crisis, when it reached 140.00 – the last time Japan intervened directly to support the currency, the note added.
The euro, sterling and the Swiss franc fell to about a four-week low against the dollar during the day.
The euro fell 0.5% to $ 1.04,560, and last fell 0.3% to $ 1.04775.
Sterling fell 0.8 percent to $ 1.22165 after data showed that the British economy contracted unexpectedly in April. Read more
The Swiss franc fell 0.5% to 0.99230 francs per dollar.
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Report by Iain Withers Additional reports by Alun John in Hong Kong Edited by Mark Potter
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