The dollar rose above ¥100 in Tokyo on Thursday, gathering upward momentum in the afternoon as Japanese stocks expanded gains.
U.S. Federal Reserve Chairman Ben Bernanke’s congressional testimony Wednesday provided no surprise to market players, traders said.
At 5 p.m., the dollar was quoted at ¥100.26-27, up from ¥99.68-70 at the same time Wednesday. The euro stood at $1.3100-3102, down from $1.3144-3147, and at ¥131.36-39, up from ¥131.05-08.
In the closely followed testimony before the U.S. House Financial Services Committee, Bernanke said the Fed’s asset purchases “are by no means on a preset course,” while noting the possibility the Fed may begin to scale back the program later this year.
“His comments provided no fresh trading pegs,” an official at a major Japanese bank said. The dollar moved narrowly for much of Tokyo trading Thursday after the big event passed, traders said.
In the afternoon, the dollar retook ¥100 in line with the additional strength of the Japanese stock market, according to the traders.
Bernanke “has managed to prevent confusion in the market by showing both hawkish and dovish stances in his testimony,” said an official at a foreign exchange margin trading service firm.
Given that the key 10-year U.S. Treasury bond yield fell below 2.5 percent following the testimony, speculation that the Fed will start reducing its asset purchases in September seems to have waned somewhat, a currency market analyst said.
Meanwhile, a Japanese bank official said Bernanke made progress in laying the groundwork for the planned reductions in the asset purchases.