Stock Market Watch

Forex Market Update: Yen Gains against the U.S. Dollar

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The yen climbed sharply against the U.S. dollar on Friday as instability in global equity markets encouraged investors to seek safety in highly liquid and safer bets such as the Japanese currency.

A data provided by Reuters showed that the yen was on course to log a best weekly performance against the U.S. dollar since early 2010.

At last check, the U.S. dollar fell 0.54% against the yen to trade at yen94.86.

Commenting over yen’s sharp jump lately, Ulrich Leuchtmann, head of FX research at Commerzbank said, “The risk-off (sentiment) we see is mainly due to markets being unsure about the monetary policy of the future … this is good reason to be cautious of risky assets and to look into safe havens like the yen,” according to Reuters.

However, the U.S. dollar index, a gauge on U.S. unit’s performance against a basket of major traded currencies, rose on Friday boosted by improving U.S. macroeconomic environment even as speculation is rife that the Federal Reserve could sooner than latter start tapering its bond purchase program.

Earlier this week, Standard & Poor (S&P) upgraded the U.S.’s sovereign credit rating outlook to “stable” from “negative”.  On Thursday, unexpectedly strong retail sales data, a closely watched economic indicator, also underpinned that the U.S. economy is showing resilience despite budget cuts in Washington.

The dollar Index, edged up 0.15% on Friday to 80.85, having plunged to its four-month low of 80.500 in the previous session.

The euro was down 0.51% against the U.S. dollar, at last check.

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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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