May 08, 2024 (MENAFN via COMTEX) --
(MENAFN) During Monday's trading session, the US dollar experienced its fourth consecutive decline following a disappointing US jobs report released the previous week. Additionally, the dollar strengthened against the yen after reports emerged regarding Tokyo's intervention in the currency market. The dollar index, a gauge of the US currency's performance against six major currencies, is on track for its longest streak of declines since early March.
The lackluster US jobs report, which showed the smallest increase in job numbers since October, eased concerns that the US Federal Reserve would need to maintain high interest rates for an extended period. This reinforced statements made by Federal Reserve Chairman Jerome Powell indicating that a rate hike is unlikely in the near term.
Consequently, the dollar index dipped by 0.23 percent to 104.93, while the euro gained 0.23 percent against the dollar, reaching USD1.0783.
Meanwhile, the yen depreciated against the dollar after registering its strongest weekly gains since December 2022. This surge came in the wake of reports suggesting interventions by the Bank of Japan to prevent the yen from reaching its lowest level in 34 years, at 160.245 yen to the dollar. The yen had appreciated by 3.5 percent over the course of the week. On Monday, the yen retreated by 0.44 percent against the dollar, reaching 153.68 per dollar.
The yen's decline can be attributed to rising US interest rates, coupled with Japan's near-zero interest rate environment. This discrepancy has prompted investors to transfer liquidity from the yen to the dollar, subsequently investing in assets offering higher returns.
In other currency movements, the British pound advanced by 0.29 percent to USD1.2581 ahead of the Bank of England's monetary policy decision announcement scheduled for Thursday. Analysts anticipate that the Bank of England will maintain interest rates at 5.25 percent.
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