Title: Dollar Down, Yen Falls Behind as Fed Hikes Interest Rates
Mar 16, 2022 11:41PM ET
The dollar was down in Asia on Thursday morning. The yen was at a six-year low against the dollar as investors continue to digest a hawkish outlook from the U.S. Federal Reserve that contrasts sharply with that of the Bank of Japan.
The U.S. Dollar Index, which tracks the greenback against a basket of other currencies, fell 0.27% to 98.355 at 11:31 PM ET.
The USD/JPY pair fell 0.05% to 118.67.
The AUD/USD pair increased by 0.25% to 0.7308, while the NZD/USD pair increased by 0.12% to 0.6844.
The USD/CNY pair fell 0.11% to 6.3451, while the GBP/USD pair gained 0.08% to 1.3155.
The US Federal Reserve raised the key interest rate to 0.5% in its decision on Wednesday. The central bank was more aggressive than expected, hinting it could raise rates at all six remaining meetings in 2022.
The yen was at 119.13 overnight, its lowest level against the dollar since early 2016. The Japanese currency also fell 1.6% against the Australian dollar on Wednesday and sank further to a four-year low of 86.97 yen per Australian dollar on Thursday.
Meanwhile, the Australian dollar climbed above its 200-day moving average. Australian labor market data for February 2022 showed an unemployment rate of 4%, employment growth of 77,400, and full employment growth of 121,900. Unemployment was at its lowest since 2008, adding pressure on the Reserve Bank of Australia to raise interest rates soon.
Across the Tasman Sea, New Zealand's GDP grew by 3% quarter-on-quarter and 3.1% year-on-year in Q4 2021.