Currency – The dollar retreats against the yen


© Reuters. The dollar retreats against the yen

Investing.com – The dollar has lost ground against the yen on Thursday after posting its strongest daily gain in six months, boosted by faster economic growth in the United States and a diplomatic breakthrough with North Korea.

The USD / JPY was down 0.27% to 106.55 at 03:35 AM (07:35 GMT), after completing the session on Wednesday with gains of 1.4%, its largest increase since September 11.

The dollar was boosted after data on Wednesday showing that the u.s. economy grew more than initially expected 2.9% in the fourth quarter.

The data have left the door at a pace a little more aggressive interest rate hikes by the federal Reserve this year. The Fed has raised its rate for the first time this year last week and maintained its forecast of three rate hikes this year.

The u.s. currency received an additional boost after China said Wednesday that the north Korean leader Kim Jong had promised its commitment to denuclearization while the u.s. president said that Kim was eager to meet him.

The developments have prompted speculation that a breakthrough on the nuclear program in north korea could be done.

The dollar index, which measures the greenback’s strength against a basket of six major currencies, was little changed near a one-week summit of 89,71.

The euro was stable, with the EUR / USD at 1.2316) after a decrease of 0.75% on Wednesday.

The single currency remained on the defensive after economic data moderate in the euro area and the comments supportive of Erkki Liikanen, member of the board of directors of the european central Bank at the beginning of the week.

The british pound remained practically unchanged against the dollar, with GBP / USD at 1.4069.

Investors turn to data on consumption and prices the United States later in the day, which will be followed closely in order to know the possible orientations of the monetary policy.

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