Speculation that the world’s largest economy will refrain from slashing monetary stimulus prompted the Japanese yen to slip against the world’s reserve currency on Tuesday, Bloomberg reports
The currency of the Pacific Rim nation fell from its three-week peak against the U.S. dollar. The yen also slipped in value against the common currency of the European Union after having surged about 1 percent during the past two trading sessions.
“The market is now beginning to try and work out what the balance is for dollar-yen,” senior currency strategist Jane Foley with Rabobank International in London told the news source on Tuesday. “There are a lot of factors and this can mean that we will get some volatility.”
The U.S. Federal Reserve might not reduce its monetary stimulus program after economic data released on Monday indicated manufacturing in the U.S. slipped during the month of May.
The Japanese yen also lost value on Tuesday after a report noted that pension funds in the nation hosting the world’s third-largest economy are poised to increase worldwide holdings, according to Reuters.
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