The U.S. dollar maintained its position near a 19-month high on Friday, following a week of strong gains driven by increasing expectations of a larger Federal Reserve rate hike. This surge in the dollar pushed the Japanese yen back toward the critical 160 per dollar mark, putting traders on high alert for potential intervention from Tokyo.
The dollar experienced its most significant weekly rise since September, supported by rising bets on a larger-than-usual Fed rate hike next month. Hawkish remarks from Federal Reserve officials, combined with stronger-than-expected U.S. inflation data this week, have intensified speculation about the central bank's next move.
As U.S. Treasury yields climbed, the yen hovered around 160 per dollar, a level that has historically prompted intervention from Japanese authorities to stabilize the currency. Traders remain cautious, monitoring for any signs of action from Tokyo to prevent further depreciation of the yen.