The repercussions of a possible Brexit are dominating the currency markets far and wide. The Aussie Dollar earlier touched its highest price since early last month against the US Dollar as markets await news of the outcome of Britain’s voting referendum. Meanwhile, the safe haven Japanese Yen is generally getting a bit of breather for the same reason, as the latest UK polls suggested that the issue of a Brexit could be moot by the weekend. Where the Japanese Yen continues to be in favor is against the US Dollar, especially given the latest dovish leanings from the Federal Reserve Bank.
As reported at 11:06 am (BST) in London, the AUD/USD was up 0.88% to trade at $0.7588; the pair hit a high of $0.7598 earlier and a session low of $0.7509. The GBP/AUD was trading at A$1.9601, down 0.40%; the pair has ranged from a session low of A$1.9452 to a peak of A$1.9713. The USD/JPY was up 0.08% to trade at 104.9125 Yen.
Safe Havens Could See Major Inflows After Vote
Currency strategists say that though hopes are pinned on Britain remaining in the EU, markets are bracing for the unexpected. In the event of a Brexit, besides the Pound plunging and the Euro coming under heavy pressure, there will be a major inflow toward the safe havens, i.e. the Japanese Yen, the Swiss Franc, and the US Dollar, despite the dovish bent of the Fed.