The Japanese Yen saw some gains versus other major currencies in early trading today in Tokyo, after the release of less than favorable economic data from the Euro Zone and the United States raised fears of investors of the strong possibility of a longer than expected economic recession. As a result, investors shied away from high yielding currencies including the New Zealand and Australian Dollars, and turned toward the safe haven Japanese Yen. According to one foreign exchange dealer, the U.S. Dollar should begin to benefit from the current trend, though he did acknowledge that the primary beneficiary remains the Japanese Yen.
The U.S. Dollar remained firm against most major currencies, except the Japanese Yen. This could be attributed to the recently released report that shows that the American economy contracted 3.8% in the last quarter of 2008. While that was the fastest pace in more than a quarter of a century, it was still below the anticipated 5.4% reduction.
The U.S. Dollar traded at 89.77 Yen, a loss of .2% from last Friday’s trading in New York. Meanwhile, the Euro continued to hover near a 2-month low versus the U.S. Dollar as a result of the continued anxiety over the Euro Zone’s faltering economies. The Euro lost .7% to trade at $1.2373. Versus the Japanese Yen, the Euro lost .9%, trading at 114.27 Yen.