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TOKYO/SINGAPORE: The dollar hit its highest in about two weeks against the yen on Thursday, supported by this week´s rise in U.S. bond yields, with the market´s attention turning to who will next lead the Federal Reserve and this weekend´s Japanese election.
The dollar index, which tracks the U.S. currency against a basket of six major rivals, was slightly higher on the day at 93.389.The dollar rose as high as 113.095 yen in early Asian trade, its strongest level since Oct. 6. The dollar last changed hands at 112.97 yen, steady from late U.S. trade on Wednesday.
This week´s rise in U.S. bond yields helped lend support to the greenback. The two-year U.S. Treasury yield rose to its highest since November 2008 on Wednesday on the back of expectations for tighter global monetary policy. The benchmark U.S. 10-year Treasury yield touched a one-week high of 2.352 percent on Wednesday, and last stood at 2.342 percent, having risen six basis points so far this week.
"In order for expectations of tighter U.S. monetary policy to increase, we will need to see more evidence to confirm that U.S. inflation is rising," said Kumiko Ishikawa, FX analyst at Sony Financial Holdings in Tokyo.
