US$ hits near 8-year high on hopes for rate hike

Tokyo

THE US dollar hit a near eight-year high against the yen on Tuesday on mounting speculation that the Federal Reserve will lift interest rates by mid-year as the US economy picks up strength.

In Tokyo, the greenback briefly surged to a high of 122.02 yen in mid-day trading, around levels not seen since July 2007. The US dollar later settled back to 121.68 yen, but was still up from 121.15 yen in New York. The euro was hovering around 11-year lows on the US dollar as the European Central Bank (ECB) embarked on its long-awaited bond-buying stimulus programme. The single currency slipped to US$1.0797 from US$1.0854 in US trade, and to 131.39 yen from 131.49 yen.