Yen Rallies Most Since 2011 as Volatility Rises Highest in Year

The yen rallied the most in two years against the dollar amid mounting speculation about the Federal Reserve reducing stimulus, spurring a gauge of volatility to the highest level since June 2012.

JPMorgan Chase & Co.’s Group of Seven Volatility Index, based on currency option premiums, rose as traders unwound bets on a weaker yen that were based on the Bank of Japan’s monetary stimulus. The euro strengthened to a three-month high against the dollar as European Central Bank President Mario Draghi said the region’s economy should recover this year. The Labor Department is forecast to report tomorrow that the U.S. added 163,000 jobs in May, and the jobless rate was unchanged at 7.5 percent, key figures as the Fed debates the duration of its stimulus programs.