The U.S dollar, on Monday, December 19, traded lower against the yen , as investors locked in profits following the Federal Reserve’s policy meeting last week.
The U.S. currency USDJPY, -0.67% was trading at ¥117.21 yen after hitting an intraday low of ¥117.24. That compared with ¥117.90 late Friday in New York, MarketWatchreports.
The dollar index, which measures the greenback against a basket of currencies, fell 0.4 per cent to 102.590. The dollar hit a 14-year high of 103.56 following the Federal Reserve’s hawkish interest rate forecasts on Wednesday.
The WSJ Dollar Index BUXX, +0.13% , a measure of the U.S. dollar against a basket of major currencies, was flat at 93/05. The euro EURUSD, -0.3445% was down slightly at $1.0437 from $1.0455 late Friday.
The dollar shot up last week to touch ¥118.66–a 17% gain since the U.S. presidential election–after the Federal Reserve signaled it may raise interest rates three times next year instead of twice as previously expected.
“We don’t see fresh trading cues,” said Kengo Suzuki, chief foreign-exchange strategist at Mizuho Securities. “What we are seeing is profit-taking or adjustment ahead of Christmas and the year-end holiday season.”
Still, investors are awaiting a scheduled speech by Fed Chairwoman Janet Yellen later in the U.S. day.
Nomura chief forex strategist Yunosuke Ikeda said in a morning note that this may be the last big event this year, adding that if Yellen hints she was among those expecting to raise interest rates three times next year, “we would see higher yields and a stronger dollar once again.”
Meanwhile, the Bank of Japan is widely expected to stand pat when it wraps up its two-day policy meeting Tuesday.
Investors will be looking to see whether the central bank will comment on the recent rise in long-term Japanese government bond yields.
