Yen plunges to 24-year low against dollar

LONDON, June 21 (Reuters) – The Japanese yen plunged on Tuesday to its lowest level against the U.S. dollar since October 1998 as the Bank of Japan’s ultra-loose monetary policy continued to weigh.

The yen fell 0.9% to a fresh 24-year low of 136.330 to the dollar, extending losses that have already seen it lose more than 18% of its value against the greenback this year.

“The trend is your friend after the Bank of Japan last Friday stuck to its ultra-dovish political mantra,” said Kenneth Broux, FX strategist at Societe Generale.

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The currency lost further ground after the Bank of Japan dashed any expectation of a policy shift on Friday and continued to stand alone in its commitment to ultra-loose monetary settings.

Instead, he stepped up his bond buying to keep 10-year yields within a target range of 0% to 0.25%. But despite his efforts, the yield remains at the upper end of this target.

Earlier in the day, Japanese Prime Minister Fumio Kishida effectively gave the green light to selling the yen when he said the BoJ should maintain its ultra-accommodative monetary policy.

He dismissed calls for the policy to be changed to target the rising cost of living. Read more

The yen’s decline was also accelerated by some broken stop losses around the 135.60 levels, analysts said, who noted traders in New York were absent on Monday, a U.S. holiday.

At 12:30 GMT, the Japanese currency was at 136.19 yen, just off the 24-year low. The yen also fell 1.2% to 143.655 per euro, its lowest level since June 9.

The yen lost more than any other major currency against the greenback, as the dovish policy stance of the BOJ stands in stark contrast to the general warmongering of global policymakers.

fall of the yen
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Reporting by Samuel Indyk; Written by Saikat Chatterjee; Editing by Sujata Rao

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