Yen Surges to a Three-Week High as Chinese Exports Decline

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Yen Surges to a Three-Week High as Chinese Exports DeclineThe yen surged to its highest level in three weeks versus the dollar after a surprise decline in China’s exports saw investors seek refuge in the safe-haven currency.

The yen gained against all but one out of its 16 major peers. The Bloomberg Dollar Spot Index plunged to its lowest in five months after minutes of Fed’s meeting in March that were disclosed yesterday lowered prospects that interest rates will be raised soon.

The yen rose 0.3 percent to 101.65 a dollar as of 7:14 a.m. in New York trade after earlier gaining to 101.42, its highest level since March 19. The currency also advanced 0.3 percent to 140.92 a euro. The dollar fell 0.1 percent to $1.3865 after plunging to $1.3875, its lowest level since March 24.

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“The Chinese data was very poor,” Eimear Daly, a London-based head of market analysis at Monex Europe Ltd told Bloomberg. “It’s also because of what we saw from the Fed. The dollar seems to be absolutely killed in recent recessions, with the market drastically pricing out these earlier rate hikes.”

The Chinese exports plunged 6.6 percent from a year ago, according to its customs administration. Imports plunged 11.3 percent, resulting in a trade surplus of $7.71 billion.

The krona plunged against all 16 major peers after consumer prices declined 0.6 percent in March from a year ago, reported Statistics Sweden. This was higher than the median estimate of a 0.3 percent slump in a Bloomberg survey of economists.

The krona fell 0.8 percent to 9.0557 a euro after earlier plunging to 9.0668, its lowest since December 17. It also decreased 0.8 percent to 6.5312 a dollar.

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