Dollar Holds Highs as Yen Slips on BOJ Signals
The US dollar held near a two-month high on Thursday, while the Japanese yen weakened after the Bank of Japan's latest policy summary offered mixed signals on future rate hikes.
The dollar's strength was supported by elevated Treasury yields, even as weaker-than-expected US inflation reduced expectations for an October Federal Reserve hike. The greenback clocked its strongest monthly performance since June, with the Bloomberg Dollar Index rising about 2% in September.
The yen slipped to a two-week low of 158.21 after the BOJ's September meeting summary showed policymakers differed on the strength of domestic growth and the pace of further rate increases. Some board members argued that the central bank should accelerate hikes or bring rates closer to its eventual target sooner, while others noted that although second-quarter growth was positive, domestic demand contracted and the economy could not necessarily be described as expanding strongly or sustainably.