Yen Gains on Strong Wage Data, BOJ Rate-Hike Bets
The yen rose against every Group-of-10 peer after better-than-expected wage growth data bolstered the case for further Bank of Japan interest rate hikes.
USD/JPY fell 0.5% to 153.53 after nominal wages rose 4.8% in December from a year earlier, the largest jump since 1997.
Real wages also grew for a second straight month in December, even as economists expected a drop amid accelerating inflation. The yen also rallied after Economic Revitalization Minister Ryosei Akazawa said the nation is in an inflationary situation.
“The yen is bought in response to the wage data,” said Keiichi Iguchi, a senior strategist at Resona Holdings in Tokyo. “Although we need to see spring wage negotiations, the data are supportive of further rate hikes”.
Bloomberg Dollar Spot Index edged 0.1% lower; yields on 10-year US Treasuries rose one basis point to 4.52%.
USD/CNH held at 7.2861.
China extended its support for the yuan by setting its daily reference rate for the managed currency at a level stronger than 7.2 per dollar amid escalating trade tensions with the US.
AUD/USD steadied at 0.6255 after advancing 0.4% Tuesday.
EUR/USD held at 1.0381.
Source : Bloomberg
