Dollar Index Near 13-Month High as Yen Falls to 162.41
DX•U.S. Dollar Index held close to a 13-month high as USD/JPY rose to 162.41, its weakest level since 1986, marking a roughly 2% decline in the yen this quarter. Official data showing China’s manufacturing PMI returned to expansion boosted the yuan 0.1% and supported broader Asian currencies.
1. Dollar Index Strength
The U.S. Dollar Index held near a 13-month high on the final trading day of Q2, buoyed by strong U.S. interest rate differentials and safe-haven demand. This persistent dollar strength underpinned gains against most major and emerging market currencies.
2. Yen at Four-Decade Low
USD/JPY climbed to 162.41, its weakest level since 1986, driving the yen down about 2% over the quarter. Japanese officials reiterated readiness to act against excessive volatility but stopped short of explicit intervention warnings.
3. Chinese PMI Supports Yuan
June’s official manufacturing PMI unexpectedly returned to expansion territory, prompting a 0.1% rise in the yuan. Improved factory output data eased concerns over China’s growth outlook and bolstered sentiment across Asian FX markets.
4. Regional Currency Movements
Other Asian currencies saw mixed results as USD/KRW jumped 0.5% on the day and nearly 3% for Q2, while USD/IDR rose 0.4% amid ongoing capital outflows. USD/TWD remained largely flat, reflecting subdued trading volumes despite positive Chinese data.
