'Dollar is king' mantra rings across currencies as yen drops to 20-year low

Traders focus on potential half-point Federal Reserve rate hike next week; Bloomberg dollar gauge set for best monthly gain in a decade

The ascendant US dollar headed for its best month in a decade, as renewed yen selling cemented the greenback’s strength against major peers. 

A Bloomberg gauge of the greenback climbed to its highest level in nearly two years and has risen 4.5 per cent this month, set for its best performance since May 2012. The yen fell further against the dollar, tumbling to a two-decade low, after the Bank of Japan (BOJ) kept interest rates at rock-bottom levels and defended its easy monetary policy. That contrasts with a Federal Reserve that has signalled aggressive rate hikes to combat inflation. 

“It’s clearly a