Investing.com – The dollar fell to its lowest level in 17 months against the safe haven yen on Tuesday, prompting speculation over a possible intervention to halt the appreciation of the Japanese currency.
hit lows of 110.30, the weakest level since October 31, 2014 and was last at 110.49, off 0.76% for the day. The pair has fallen more than 8% so far this year.
The dollar continued to weaken against the yen after last Friday’s strong U.S. jobs report did little to alter the view that the Federal Reserve will stick to a cautious approach on rate hikes.
Despite the steady pace of jobs growth few investors expect the Fed to hike rates more quickly after recent dovish comments by Chair Janet Yellen.
Lower interest rates make the dollar less attractive to yield seeking investors.
Investors were turning their attention to Wednesday’s minutes of the Fed’s March meeting for fresh indications on the future path of interest rates.
The yen, which tends to be bought by investors in times of market turmoil, was boosted as fell for a third straight session, hitting one-month lows and .
The yen’s gains fueled speculation over how much higher the currency can climb before Japanese officials act to weaken the currency.
The Bank of Japan shocked markets with its decision to adopt negative interest rates earlier this year but the yen has continued to strengthen, posing a challenge to the central bank’s attempts to spur price growth.
The yen advanced to two-week highs against the euro, with down 0.96% to 125.59.
The euro was also lower against the dollar, with down 0.24% at 1.1363.
In the euro zone data on Tuesday showed that .
The ticked down to 53.1 for March from 53.3 in February and lower than the preliminary estimate of 54.0.
The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.12% at 94.7, holding above last Thursday’s five-and-a-half month lows of 94.31.
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