The yen traded 0.2 percent from a five-year low against the dollar as the Bank of Japan continues unprecedented easing while the U.S. Federal Reserve begins to pare stimulus.
The yen fell as the Nikkei 225 Stock Average (NKY) closed above 16,000 for the first time in six years, reducing demand for the currency as a haven. The dollar held a gain after U.S. reports showed orders for durable goods and new-home sales rose more than forecast. Australia’s currency gained for a fifth session against its New Zealand counterpart.
“If we continue to have more strong economic numbers from the U.S., there’s a high possibility the yen could weaken to 105 per dollar,” said Yasuhiro Kaizaki, the vice president of global markets in New York at Sumitomo Mitsui Trust Bank Ltd. “The divergence in monetary policy between the U.S. and Japan is the main driver of dollar-yen, and I don’t see that changing.”
