Yen Gains against Peers on Several Factors, Krona Plunges

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Yen Gains against Peers on Several Factors, Krona PlungesThe yen advanced against most major counterparts after a report by a private firm showed that Chinese factory activity shrunk more than expected in April, spurring the demand for the safe-haven assets.

The yen was up 0.1 percent at 102.07 a dollar as of 10:04 a.m. in New York, after earlier surging to 101.87, a two-week high. The yen also gained 0.1 percent to 141.65 per euro, while the euro gained 0.1 percent to $1.3877.

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The Japanese currency also benefitted from reports that Ukraine crisis had escalated and comments by Bank of Japan Governor Haruhiko Kuroda that the economic recovery is still on course, ending bets that the central bank will roll out a stimulus program.

“This yen strength is for a few different reasons,” Masafumi Takada, a director at BNP Paribas SA in New York, told Bloomberg. “The China PMI was weak” and there’s Russia, Ukraine tension, with vague talk of Russian war planes getting ready that triggered risk-off.”

The Swedish krona plunged on reports that industrial output plunged unexpectedly in March. The krona fell 0.6 percent to 6.5481 per dollar and tumbled 0.7 percent to 9.0876 a euro. Statistics Sweden reported that factory production declined 3.8 percent in March, after earlier expanding 2 percent in February. This lagged the median estimate of a 0.5 percent growth in a Bloomberg survey of economists.

The Turkish lira rose against most of its major counterparts after the country’s statistics agency reported that consumer prices (inflation) rose the most in two years at 9.38 percent in April. The lira advanced 0.3 percent to 2.0985 a dollar. It also gained for the eight straight day, a winning streak it last recorded in April 2010. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com