On a (sushi) roll.
The yen is on something of a tear during afternoon Asian trade, relative to yesterday when the dollar broke under ¥100 mark and closed nearly 1 per cent stronger.
Pushing Tuesday’s moves were weak US inflation data, which weighed on the greenback.
But on Wednesday the Japanese currency reversed course, pulling back by as much as 0.9 per cent to hit ¥101.17 after the lunch break.
Says Adam Cole at Canadian bank RBC:
This is partly reflecting a further drift higher in US yields and helped by a step up in MoF rhetoric. Vice Minister Asakawa described moves as “rough” and said MoF would have to act if they became extreme. Our models still suggest the risk of physical intervention is low and we think material bounces (in the dollar) should be sold into. The move in the dollar against the yen has spilled over into a firmer dollar elsewhere, though moves have been limited.
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