Stock Market Watch

Forex Market Update: Dollar Slumps against the Yen

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The U.S. dollar traded broadly lower and global equities nosedived on Thursday as panic selling continued amid rising uncertainty over the Federal Reserve’s stance on multi-billion economic stimulating measures.

The Bank of Japan’s (BOJ) and European Central Bank’s (ECB) more hawkish stance in the recent past has also stoked concerns that the period of easy money might be coming towards an end, denting investors’ risk appetite. Nikkei 225 fell 6.35% while all leading European averages were also sharply lower on Thursday.

Earlier this week, ECB Chairman, Mario Draghi said that the central bank will not resort to fuelling up the inflation rate to end the economic crisis in the currency union while BOJ also refrained from offering any more monetary easing measures.

Rising concerns that global central banks would now put a break on their ultra-loose monetary policy is prompting investors to look towards safer bets such as yen, a currency which is considered as one of the most liquid and safe currencies in the times of economic ambiguity.

Earlier today heavy sell off pressure weighed on the U.S. dollar, which plunged 2% against the Japanese currency as rattled investors shaken by rout in Japanese equities bought yen to cover losses.

The U.S. dollar hit as low as 93.90 yen, showed a data provided by Reuters. The trade was lowest since April 4. The U.S. dollar has now pared almost all of its gains against the yen after the BOJ initiated the most aggressive monetary easing program back in April.

 

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edliston
Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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