Yen hits 34-year low, equity markets mixed before key U.S. data

Yen plunges to 34-year low against dollar amid speculation of Bank of Japan intervention, impacting global markets.

London

The yen plunged Wednesday to a 34-year dollar low on fervent speculation that the Bank of Japan could step into markets to support the unit, having hiked interest rates last week for the first time since the global financial crisis.

The yen dropped to 151.97 to the dollar in Asian trading hours, touching the lowest point since 1990 before strengthening somewhat in the European session.

A top Bank of Japan official indicated that it would press ahead with a loose monetary policy, even after it pulled the plug on its ultra-aggressive monetary stimulus programme to deliver its first hike in borrowing costs since 2007.

The weaker yen helped spur a rally in Tokyo’s benchmark Nikkei stocks index as exporters benefited, making it Asia’s best performer.

Other global stock markets diverged before this week’s US data, which is expected to shed light on the outlook for Federal Reserve interest rates.

World oil prices meanwhile trod lower on signs of weakening demand in major consumer the United States.