Yen Marks a Successful Week as Ukraine Crisis Spurs Demand for Safe-Haven Assets

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Yen Marks a Successful Week as Ukraine Crisis Spurs Demand for Safe-Haven AssetsThe yen rose the most of all the U.S. dollar’s major counterparts spurred by the escalating Ukraine crisis sent investors scampering for safe haven assets.

The yen gained 0.3 percent over the past week to close at 102.16 a dollar on Friday. It also advanced 0.1 percent to 141.30 per euro. The euro rose 0.2 percent to $1.3834. The Bloomberg Dollar Spot Index, which monitors the dollar against 10 major peers, ended the week at 1,012.74.

“Against a backdrop of limited, new fundamental drivers, the Ukraine-Russia situation has received more focus,” Robert Lynch, a New York-based currency strategist at HSBC Holdings Plc, told Bloomberg. “That has contributed to a modest wave of risk-off bias, weighing on dollar-yen.”

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The Swiss franc, another safe-haven currency, rose 0.2 percent. The Russian ruble plunged 1.3 percent to 42.2707 against the central bank’s basket of currencies along with other emerging-economy currencies after German Chancellor Angela Merkel disclosed that Group of Seven nations plans to introduce new sanctions against Russia. The Mexican peso plunged 0.6 percent, while the South African rand declined 1.5 percent.

The ruble also fell after Standard & Poor’s slashed Russia’s debt rating to BBB-, just a notch higher above junk status. The rating, which has a negative outlook, placed Russia on par with Azerbaijan and Brazil.

The Chinese yuan marked its longest decline in two months when it plunged for six consecutive days. The yuan fell 0.5 percent to 6.2536 a dollar last week, and hit its lowest trough since December of 6.2583 on Friday. 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