Yen’s fair value seen around 140 to dollar amid narrowing rate gap

TOKYO — The yen has strengthened sharply following dovish signals from the U.S. Federal Reserve, with one estimate placing the Japanese currency’s fair value at about 140 to the dollar in light of the countries’ narrowing rate gap.

Fed Chairman Jerome Powell at a policy meeting Wednesday “signaled flexibility on cutting rates relatively soon, even if inflation does not settled completely,” said Makoto Noji, chief foreign exchange strategist at SMBC Nikko Securities.

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