Japanese Yen and U.S. Dollar fall on Hope of U.S. Auto Bailout
Both the U.S Dollar and the Japanese Yen fell today as some investors were comforted by a tentative bailout arrangement between the U.S. lawmakers and the big three auto makers. It appears that the House of Representative in the U.S. could vote soon on the $15 billion bailout plan and restructure the three auto makers. However, the bailout plan is likely to face some significant roadblocks from the U.S. Senate.
Traders have been moving out of the U.S. Dollar and low-yielding Japanese Yen following the recovery of stocks and the reduction in market volatility, which boosted sentiment and increased demand for risky assets.
Despite the U.S. Dollar’s broad losses, it increased by 0.5% against the Japanese Yen and traded at 92.62 Yen, which was also impacted by a reduction in risk aversion. The Euro gained 1% against the Japanese Yen and traded at 120.25 Yen. Versus the U.S. Dollar, the Euro traded at $1.3004, its highest level in 2-weeks, after shares in Asia surged by 3% to its highest level in a month. The U.S. Dollar .DXY fell by almost 0.3% against a group of currencies, trading at 85.577.