SINGAPORE - The yen floundered near a fresh 24 year low on Thursday, while sterling held onto overnight gains as investors skittishly watched the end of the Bank of England's emergency bond-buying programme.
The yen hit a trough of 146.98 per dollar overnight - its lowest since August 1998 and last traded at 146.82.
The yen is a bit away from its August 1998 low of 147.64 per dollar, and is well past last month's low of 145.90 per dollar, which prompted Japanese authorities to buy the yen.
Rodrigo Catril, a senior currency strategist at National Australia Bank, said it lost its safe haven appeal.
There is a sense of cautiousness around that previous high for the dollar yen, now they've punched through it, and it feels like you have a little bit more room to go, because there hasn't been any intervention. The pound was down 0.03 per cent to $1.1095, after a rebound in the previous session.
It rallied 1.25 per cent on Wednesday after the Financial Times reported that the BoE had signalled privately to lenders that it was prepared to extend its emergency bond buying programme beyond Friday's deadline if market conditions demand it, though the central bank reiterated on Wednesday that its programme of temporary gilt purchases will end on October 14.
Britain's new government said on Wednesday that it wouldn't reverse its tax cuts or reduce public spending - a plan that has wreaked havoc on the country's financial markets and pension industry.
The UK pension schemes are rushing to raise hundreds of billions of pounds to shore up derivatives positions before the BoE's Friday deadline.
The euro gained 0.01 per cent to $0.9702, while the antipodean currencies were nursing losses after having fallen to new multi-year lows earlier in the week.
The Australian was up 0.14 per cent at $0.6287 after sliding to a 2 -- 1 2 year low of $0.62355 in the previous session.
The kiwi went up 0.06 per cent to $0.5611, not far from its trough of $0.5536 hit on Tuesday, the lowest level since March 2020.
The Fed will continue to tighten policy, with the data expected to reinforce bets that the U.S. inflation figures out later on Thursday.
Core inflation is projected to rise 6.5 per cent year-on-year in September. U.S. producer prices went up more than expected last month, according to the data.
The U.S. dollar index was trading at 113.27.
The details are going to be the ones that matter here and the drivers behind core reading will be super important, said Catril, NAB's catril.
It will require a lower number to change the rhetoric from the Fed, and we don't see that at the moment. Minutes from the Federal ReserveFederal Reserve policy meeting last month showed that officials agreed that they needed to raise interest rates to a more restrictive level and then keep them there for some time to meet their goal of lowering broad-based and unacceptably high inflation, even though the minutes contained a hint of a downshift in the pace of future monetary tightening.