With the U.S. presidential election now over, investors are focusing their concern on the so-called fiscal cliff which looms; with risk appetite largely diminished, the Japanese Yen struck a 1-month peak versus the common currency Euro during the Asian session. The Euro had earlier found some support after the Greek Parliament announced their approval of new austerity measures which are required for the funding of the next bailout payment.
As reported at 12:05 p.m. (JST) in Tokyo, the EUR/JPY pair was trading at 101.78 Yen, a decline of 0.4% from late trading in New York; earlier it had struck 101.75 Yen, the common currency’s lowest level versus the Yen in nearly a month. The U.S. Dollar also slipped against the Japanese currency last trading 0.2% lower at 79.82 Yen, off the 6-month peak of 80.68 Yen which was hit last week.
Analysts confirm that heightened risk aversion is likely to provide support to the safe haven Japanese Yen, as well as the U.S. Dollar. The Yen was able to stay firm despite a large sell-off on Wall Street, with market players beginning to price in the prospect of a drop off from the fiscal cliff in the short-term.