Yen Reverses Earlier Gains against Peers on Reports of Ukraine Accord

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Yen Reverses Earlier Gains against Peers on Reports of Ukraine AccordThe yen plunged on Thursday after the United States, Russia, Ukraine and the European Union called for an end to violence in the eastern part of Ukraine, causing investors to reduce their yen-denominated holdings.

This comes before the Easter weekend, which will see London’s financial market closed on Friday and Monday and the U.S. markets won’t be open for trading this Friday. However, Tokyo’s trading will continue as usual.

The yen reversed its earlier gains against the euro and the dollar, plunging 0.2 percent against both of them to trade at 102.44 yen per dollar and 141.53 yen per euro. The currency has so far plunged 0.8 percent this week against the dollar, erasing part of its last week’s advance of 1.6 percent. Against the euro, the Japanese currency has slid 0.2 percent this week.

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The yen, normally considered a safe-haven currency, had earlier gained this week as the market fretted over the possibility that the Ukraine conflict may develop into an all-out civil war. The joint statement issued by the interested parties on Thursday also prompted traders to reduce their holdings in the U.S Treasuries and the Swiss franc.

“The statement reduces the geopolitical concerns that have been overhanging market. That’s why we’ve seen a pop up in Treasuries yields and the dollar,” Omer Esiner, a Washington-based chief market analyst at Commonwealth Foreign Exchange told Reuters.

The euro was trading at $1.3814, slightly unchanged after touching an intraday low of $1.3811.The 18-nation currency is headed for a 0.5 percent decline against the greenback after earlier rising 1.3 percent last week. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Yashu Gola at yashu@forexminute.com