Swine Flu Worries Forex Markets

Concerns over the increasing death toll from persons infected with the swine flu has caused the Mexican peso to fall more than 2% in early Asian trading, while propping up the Japanese Yen and the U.S. Dollar. It has been reported that more than 81 people in Mexico have died from the swine flu, with several more confirmed cases reported in the United States, as well as Canada. According to one representative of the World Health Organization (WHO), the swine flu could shortly become a pandemic if the outbreaks cannot be controlled.

On Friday, the Mexican peso closed at 13.284 pesos against the U.S. Dollar, but as reported at 9:55 a.m. in Tokyo, the Peso traded at 13.60 versus the greenback. As reported at 9:55 a.m. in Japan, the U.S. Dollar fell against the Japanese Yen to its lowest level in almost a month, trading at 96.62 Yen, but managed to fight back to 96.87 Japanese Yen, a loss of .3% on the day’s trading. The U.S. Dollar is seeing some gains versus the Australian and N.Z. Dollars, trading at $0.716, a loss of .9% and $0.5660, a loss of nearly 1%, respectively. Investor concerns over the spread of the swine flu virus spurred them to seek out currencies that they perceive as “safe havens.” One analyst commented that there is an underlying fear that the virus could lead to a reduction in tourism and travel to the North American continent, contributing to the global economic slowdown.