The yen fell against all but one of its 16 most-traded counterparts as the Bank of Japan (BOJ) added to its monetary stimulus program amid better-than-forecast US jobs data, which renewed appetite for higher-yielding assets.
The Japanese currency declined for a third week against the dollar, touching a six-month low on Friday, after hiring in the US increased more than forecast. The currencies of New Zealand and Australia gained versus the yen after Chinese manufacturing accelerated. The Dollar Index rose for a second week before the presidential election on Tuesday.
“What’s making the yen move is the better US data and the fact that risk aversion in Europe continues to decline,” Adam Myers, director of foreign-exchange market strategy in London for at Credit Agricole SA, said on Friday.
The BOJ easing “was not enough of a surprise. We may be due for a snap-back, as the markets have become very sanguine,” he said.
The yen fell 1 percent to ￥80.43 per US dollar this week in its longest losing streak since March. It touched ￥80.68 on Friday, the weakest level since April 27. The Japanese currency declined 0.2 percent to ￥103.24 versus the euro. The shared currency dropped for a second week against the US dollar, sliding 0.8 percent to US$1.2835.
The BOJ added ￥11 trillion (US$137 billion) to increase its fund to ￥66 trillion, while a separate credit-loan program will stay at ￥25 trillion. It will also offer unlimited loans to banks to boost credit demand.
The Dollar Index, which IntercontinentalExchange Inc uses to track the greenback against the currencies of six US trading partners, gained for a second week. It rose 0.6 percent to ￥80.56, touching an almost two-month high on Friday after the nonfarm payrolls report. The gauge is weighted 57.6 percent to movements in the euro.
The pound rose against the euro for a second week, touching a one-month high, as signs of improvement in the UK economy dampened expectations for more monetary stimulus.