By: Barbara Zigah
The Japanese Yen has gained strong momentum versus the single currency Euro and the U.S. Dollar in early trading in Asia today, as investors speculate that a withdrawal in higher risk assets may result in the Yen’s continued uptrend. As reported at 2:46 p.m. (JST) in Tokyo, the Yen gained .7% versus the Euro to trade at 131.15 Yen, a 6-week high from 130.96 Yen, touched on in late May. The U.S. Dollar traded at 94.15 Yen on the EBS trading platform, also a 6-week high.
Since March, risk appetite has been increasing and investors have been moving away from perceived safe-haven currencies. This is causing the U.S. Dollar to slip broadly as investors continue to believe that the global recession is waning and the worst is now behind. Recently, though, investors have begun to wonder if their new-found optimism is overstressed.
These doubts have resulted in declines from June peaks in higher-risk currencies including the Pound Sterling, Australian Dollar and even the Euro, to some extent. Sterling traded at $1.6092, a decline of .2% and close to a 1-month low trade of $1.6060 touched on earlier in the day. A policy decision from the Bank of England is to be released tomorrow, and analysts expect that the BofE will hold their benchmark interest rate at a historic low of .5%, and pour an additional £125 billion into the monetary system for their quantitative easing program.
Japanese Yen gains broadly on Growing Risk Aversion
Barbara Zigah
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About Barbara Zigah
After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.