After the Fed’s $10 billion tapering announcement, the Japanese yen exchange traded fund pulled back, with the yen currency trading near a five-year low against the U.S. dollar.
The CurrencyShares Japanese Yen Trust (NYSEArca: FXY) is down 1.5% since the Dec. 17 close. FXY is down 16.9% year-to-date.
The U.S. dollar hit a five-year high against the yen, trading at 104.36 yen, Reuters reports.
“Net-net, the Fed’s announcement yesterday was hawkish, not dovish,” Stephen Jen, co-founder of SLJ Macro Partners, said in the Reuters article. “The dollar should continue to appreciate, and its strength is likely to broaden out over time, as long as the US economy continues to recover.”
Meanwhile, Japan’s Nikkei climbed to its highest close in six years Thursday, bolstered by a surge in the dollar to yen rate as investors capitalized on a weak currency in an export-oriented economy, Reuters reports.