The Japanese yen continued to surge on Friday and was on track for its biggest weekly gain in four months versus the US dollar with bets that US utility rates are nearing peak after data showing the world's largest economy pegged unexpectedly in the June rate.
Futures trading markets predict that the US benefit rate will peak towards December this year versus Jun 2023 in early July and the Federal Reserve will reduce the utility rate by 50 principal points next year to support slow growth.
The impression of a rapid decline in the expected rate hikes has been a big driver for the US dollar's weakness versus the yen, shedding nearly 2.5% on the week, its biggest weekly drop since late March.
The yen rose 0.8% on Friday to 133.17 yen to its highest level since mid-June.
According to strategist Mizuho, “The main trigger for the yen's bounce was an adjustment lower in U.S. yields reflecting a narrowing outlook for the underlying divergence between the Fed and the Fed.
BoJ,".
The gap between yields in the U.S. Treasury 10 years and the equivalent Japanese royal debt has shrunk by 70 principal points since early June, following U.S. growth. slowly and rising utility rates, pushing Treasury yields lower.
The US dollar was generally trading lower against the six major currencies with a 0.04% decline to trade levels of 106,195.
U.S. user spending the other hand overcame expectations in June that inflation was growing rapidly.
