The U.S dollar, on Tuesday, December 13, firmed up against the yen and euro after its weakest day in a week, with markets still uneasy that a Federal Reserve meeting ending on Wednesday may provoke more investors to cash in the greenback’s recent gains.
The yen strengthened to less than 115 yen per dollar in Asian trade before settling at 115.34, down 0.2 percent on the day but almost a full yen stronger than 24 hours previously.
It has borne the brunt of the dollar’s rally in the past month, down 13 percent since October. But some traders and analysts have begun to wonder if the Japanese currency might benefit next year if global political risks grow. Barclays forecasts the dollar weakening to 100 yen in a year’s time.
The euro was little changed at $1.0629, having gained 0.7 percent on Monday as German bund yields rose amid signs Italy will bail out Italian bank Monte dei Paschi di Siena if need be.
Sterling inched higher, helped by comments from Chancellor Philip Hammond backing a transition period to smooth the process of leaving the European Union.
Analysts from BNP Paribas said in a note to clients that rates markets are discounting close to five 25 basis point Fed rate hikes by the end of 2018,”
