The USD declined on Thursday, hitting a seven-week low point versus the Japanese currency and a 28-year low against the AUD currency after traders took falls in U.S. bond yields as a cue to get rid of it.
U.S. Treasuries made a comeback on Wednesday, pushing yields significantly lower, after a $29 billion auction of seven-year notes drew surprisingly strong demand a day after a weak five-year sale.
The USD slipped to 81.40 yen JPY=, its lowest in seven weeks and inched closer to a 15-year low of 80.21 yen hit in November.
As thin trading due to New Year's evet ends to exaggerate currency moves, market players say there is high risk of the dollar nearing the November low or even to its postwar low of 79.75 JPY marked in 1995.
Data on U.S. initial jobless claims later in the day and more importantly U.S. manufacturing data due on Monday could become the impetus to push the USD down, they said.
Keiji Matsumoto, a strategist at Nikko Cordial Securities, also said a rise in the Chinese yuan after China's rate hike last Saturday is supporting Asian currencies, including the yen.