The yen appears set to record weekly gain as investors rushed for the safe haven currency due to fragile growth in some advanced economies.
The Japanese currency remained slightly unchanged at 101.53 for a dollar in mid-morning trade in London after earlier surging to 101.32 on Thursday, its highest point since March 19. The yen was trading at 139.24 against the euro after earlier rising to 138.98 yesterday, a level since February 27. The shared currency remained steady at $1.3715 after earlier plunging to $1.3648 on Thursday, also its weakest level since February 27.
U.S. Treasury yields hit their weakest level since October 30, weighing on the dollar, while Federal Reserve Chair Janet Yellen revealed that the U.S. economy still needs stimulus. Yield on benchmark 10-year Treasuries plunged to 2.47 percent on Thursday.
“Lower U.S. yields are yen positive, as are weaker global equity markets,” Adam Cole, a London-based head of Group-of-10 currency strategy at Royal Bank of Canada, told Bloomberg. “We are back at the bottom of the range for the dollar versus the yen. We could see some capitulation on short yen positions.”
The MSCI All Country World Index fell 0.2 percent on Friday after earlier plunging 0.7 percent on Thursday.
The yen has gained 0.3 percent so far since last Friday, after earlier appreciating 0.3 percent a week earlier, its first week-to-week advance since week ended January 31. The euro appears set to decline 0.6 percent against the yen and 0.3 percent versus the greenback this week. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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