The U.S. dollar advanced to the upper 151 yen range on Wednesday in New York, a level not seen since November, as expectations that the interest rate gap between the United States and Japan will remain wide continued to spur dollar-buying and yen-selling.
At 10 a.m. in New York, the dollar traded at 151.69-79 yen after briefly rising to around 151.80 yen in London the same day.
Prior to the surge, the U.S. currency traded in the lower 149 yen range before the Bank of Japan announced on Tuesday that it would discontinue its negative interest rate policy while indicating an expectation of continued accommodative conditions. Financial markets in Japan were closed Wednesday due to a national holiday.
Japanese authorities conducted a dollar-selling, yen-buying market intervention in October 2022 after the dollar rose to 151.94 yen.
The U.S. Federal Reserve has hiked the target range of the key federal funds rate since 2022 to curb stubborn inflation, and is widely expected to maintain the current rate, a 23-year high of 5.25-5.50 percent, in the two-day policy-setting meeting through Wednesday.
As recent U.S. economic data suggest inflation has edged up, the prospect has diminished that the Fed will decide on a rate cut early this year.
The BOJ said Tuesday that short-term interest rates will be guided within a range of zero to 0.1 percent under the ultraeasy policy.
