Yen falls to 32-yr low near 150 level vs. U.S. dollar

USD/JPY remains slightly higher in Asian trading on Friday, hovering around the 32-year mark of 150.25-30, pushing the yen pair higher for 13 straight days and reaching its highest level since 1990 amid strong yields and the Bank of Japan's (BOJ) defense of easy money policies. It is worth noting that Japanese inflation data hit a multi-year high earlier in the day, which in turn put more pressure on policymakers to intervene in the markets and protect the yen. Japan's core consumer inflation rate rose to a fresh eight-year high of 3.0% in September, exceeding the central bank's 2% target for the sixth straight month, as the yen's slump to a 32-year low continues to push up import costs," Reuters reported. Following the data, Japanese Finance Minister Shunichi Suzuki said Friday that authorities were taking "strict action" against currency speculators as an extended sell-off in the yen kept markets on heightened alert for further intervention by Tokyo in selling dollars. The BOJ also announced emergency bond purchases for the second day in a row and increased the amount of bonds it buys as part of its planned operations (Reuters). Elsewhere, initial jobless claims in the U.S. fell to 214,000 in the week ended 07 October from 230,000 expected and a downwardly revised 226,000. The Philadelphia Fed Survey Index for manufacturing fell to -8.7 in October from the market consensus of -5 and the previous reading of -9.9. In addition, U.S. existing home sales rose above the expected 4.7 million to 4.71 million, but fell below the previous 4.78 million. Recently, Federal Reserve Governor Lisa Cook mentioned that more rate hikes will be needed. Amid these developments, 10-year U.S. Treasury bond yields hit a 14-year high the previous day and stood at 4.22% at press time. Two-year U.S. government bond yields also rose to their highest level since 2007 before recently falling to 4.62%. In addition, Wall Street closed in the red after an initial positive performance, while S&P 500 futures extended their previous day's losses, falling 0.50%. It should be noted that the escalating hawkish Fed calls, in contrast to the dovish BOJ statements, also underpinned the USD/JPY pair's upward momentum. The CME's FedWatch tool suggests a near 98% probability of a 75bps rate hike by the Fed. Any interference by Japanese policymakers in the market will be closely watched and may trigger the USD/JPY sell-off. Until then, the bulls may hold the reins. Also important will be the last dose of comments from Fed speakers before the blackout period ahead of the November Federal Open Market Committee (FOMC) meeting.