News: FOREX-Yen slides through 120 as U.S. hike path steepens

The dollar was buttressed by new bets on U.S. rate hikes on Tuesday, while investors unloaded yen and sent it spearing below the psychological 120 level as the Bank of Japan looks increasingly isolated in its dovish policy stance.
The yen JPY=EBS fell 0.8% and hit a six-year low of 120.46 in the Tokyo afternoon, having lost more than 4% on the dollar this month as leaping U.S. yields and a deteriorating trade balance suck cash from the world's third-biggest economy.
Yen crosses also suffered, with the euro EURJPY= making a five-week high of 132.33, while the Japanese currency slumped to a four-year low on the Aussie AUDJPY= and a 6-1/2 year low on the Swiss franc CHFJPY= .
Japan must maintain ultra-loose monetary policy lest inflation hurt the economy, BOJ Governor Haruhiko Kuroda said on Tuesday - a stark contrast with hawkish overnight comments from Federal Reserve Chair Jerome Powell.
"Rising energy prices and higher U.S Treasury yields are both bad news for the Japanese yen," said analysts at Singapore's UOB in a quarterly outlook note that lifted their year-end dollar/yen forecast from 119 to 121.
Powell had sent U.S. yields to multi-year highs by putting the possibility of 50 basis point (bp) rate hikes on the table.
Fed funds futures 0#FF: moved to price in a 2/3 chance of a 50 bp hike in May and now anticipate the benchmark rate - currently below 0.5% - exceeding 2.5% in 2023. FEDWATCH
Two-year, five-year, 10-year and 30-year Treasury yields all stood at their highest since 2019 on Tuesday, widening the gap on pinned Japanese yields while lending the dollar broad support elsewhere.
The euro EUR=EBS was down 0.2% to $1.0988. The Aussie AUD=D3 and kiwi NZD=D3 each dipped 0.1%.
The U.S. dollar index =USD rose 0.2% to 98.700. Sterling GBP=D3 eased 0.2% to $1.3144.
The Chinese yuan was also under some pressure and has pulled back from early-month highs as investors await promised monetary easing. It last traded at 6.3648 per dollar onshore CNY=CFXS .
"Although the Chinese central bank left 1-year and 5-year loan prime rates unchanged ... on Monday, we still expect the (People's Bank of China) to lower the reserve ratio requirement by 50 bp again, as early as Q1 2022," Scotiabank strategist Qi Gao said. "We maintain our short USD/CNH spot position."
Cryptocurrencies were bid on Tuesday with bitcoin BTC=BTSP up 5% at a three-week high of $43,337.
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	Currency bid prices at 0525 GMT 
 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	   EUR=EBS	$1.0987		$1.1016	 -0.26%		 -3.36%	  +1.1026	 +1.0981 
 Dollar/Yen		JPY=EBS	120.3300	   119.4850	+0.72%		 +4.63%	  +120.4550   +119.4600 
 Euro/Yen		 																			 
 Dollar/Swiss	  CHF=EBS	0.9363		 0.9337	  +0.26%		 +2.63%	  +0.9366	 +0.9335 
 Sterling/Dollar   GBP=D3	 1.3134		 1.3169	  -0.22%		 -2.85%	  +1.3172	 +1.3126 
 Dollar/Canadian   CAD=D3	 1.2599		 1.2597	  +0.02%		 -0.34%	  +1.2603	 +1.2573 
 Aussie/Dollar	 AUD=D3	 0.7386		 0.7400	  -0.19%		 +1.61%	  +0.7409	 +0.7376 
 NZ				NZD=D3	 0.6873		 0.6886	  -0.24%		 +0.37%	  +0.6892	 +0.6864 
 Dollar/Dollar																				   
All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX
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World FX rates	https://tmsnrt.rs/2RBWI5E 
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