Japanese yen plunges to 24-year low against US dollar

By Tuba Sahin

ANKARA (AA) – The Japanese yen sank to a fresh 24-year low on Wednesday, fueled by a widening policy gap between the Bank of Japan (BoJ) and the US Federal Reserve.

The US dollar rose to as high as 146.38 yen during the day, surpassing levels that led Japan to intervene in the foreign exchange market last month for the first time since 1998.

While the Japanese central bank pursues an ultra-loose monetary policy to support economic growth, the Fed is expected to continue its aggressive monetary tightening to tame soaring inflation.

In September, the BoJ kept its ultra-low interest rate unchanged at minus 0.1%, while the Fed raised its benchmark rate by 75 basis points for the third consecutive time.

Surging raw material and energy prices are also weighing on the yen as they force Japanese firms to purchase more dollars for imports.