Yen weakens on interest rate speculation

The yen weakened in relation to the US dollar and other currencies on the likelihood that interest rates in Japan will stay at 0.5 percent for the foreseeable future.

In late morning trade in New York, the yen traded at ¥107.9900 to the US dollar while it was at ¥167.4547 in relation to the euro, fell to ¥10.498 against the Mexican peso and fell to a 9-year low versus the Brazilian real at ¥66.926 to the South American currency.

The greenback, meanwhile, traded at $1.5506 to the euro on expectations of a rate hike by the European Central Bank, possibly as soon as July, while the Federal Reserve is not expected to raise rates until the end of the year, when a quarter-point increase is expected.

The pound weakened versus the dollar and the euro on speculation, based on the minutes from the most recent meeting of the Bank of England’s Monetary Policy Committee, that UK interest rates will not rise soon.

At shortly before noon in New York, it took $1.9573 to buy a pound while the UK currency traded at 79.22p to the euro.

The Australian and New Zealand dollars strengthened, but indications that the Australian economy could be slowing and a decline in jobs there in May limited gains for the Aussie.

It took 94.42 cents US to buy an Australian dollar, while a New Zealand dollar was worth 75.66 cents US.

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