Yen tumbles to 20-year low vs dollar on interest rate differential

© Kyodo News

The yen maintained its overnight weakness and continued to fall in the upper 132 zone against the U.S. dollar Tuesday morning in Tokyo, trading at a 20-year low on speculation that the interest rate gap will widen between Japan and the United States.

The Japanese currency skidded to around 132.70 against the dollar in Tokyo trading, the lowest level since April 2002, as expectations grew that the U.S. Federal Reserve will continue its aggressive monetary tightening.

On the stock market, export-oriented issues were bought on the yen's weakness, with the 225-issue Nikkei Stock Average rising 115.26 points, or 0.41 percent, from Monday to 28,031.15. The broader Topix index was up 14.30 points, or 0.74 percent, at 1,953.41.

On the top-tier Prime Market, gainers were led by mining, transportation equipment and bank issues.