Home›Forex›Major Pairs›Yen slides toward 40-year lows as USD firms on oil and…

Yen slides toward 40-year lows as USD firms on oil and Iran tensions

JPY traded around 162.50 versus the US dollar on Friday, nearing the 162.84 level hit earlier this month, as higher oil prices and geopolitical risk weigh on the currency.

Reported · Written up by our desk · Major Pairs

The Japanese yen weakened for a second straight day against the US dollar, reaching the 162.50 area on Friday and moving closer to a 40-year low of 162.84 hit earlier this month, according to FXStreet.

FXStreet cited a firmer greenback as a key factor, supported by higher oil prices and growing tensions in Iran, which have pushed expectations that central banks may need to tighten policy.

The outlet also pointed to a safer-rate differential outlook for Japan, saying higher oil could pressure major central banks including the Federal Reserve to hike, while Japanese authorities are likely to keep Bank of Japan tightening limited to avoid conflicting with growth plans.

FXStreet noted that the yen is heavily influenced by interest rate gaps and risk sentiment, and that with the Bank of Japan generally maintaining an ultra-loose stance, the currency may remain exposed to carry trading conditions.

More like this

Sources