Yen Rises as Carry Trade Suffers

The Japanese currency rose today on Forex during the Asian trading session as the stocks market drop spurred carry trade sell-offs and the liquidation of the yen-based high-risk assets.

The yen gained against Great Britain pound, U.S. and Australian dollars, while remaining relatively weak against the euro today. German Ifo report on business climate in the country was released today at 8:00 GMT strengthening the euro’s position with a better than expected index value for May.

Although the worries of recession and the worst financial market slumps are slowly fading in the investors’ field of view, the low-yielding currencies, such as yen and Swiss franc, are still seen as a safe haven, when markets are suddenly falling and $130/barrel oil prices threaten to hurt global growth.

The USD/JPY rate declined today for a second day straight  from 103.62 to 103.43 as of 8:33 GMT with a daily minimum at 103.14. GBP/JPY dropped from 203.86 to 203.46 with a daily low at 202.74. AUD/JPY was falling from 99.29 to 98.87 during the Forex Asian session today.

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