Get 40% Off
🚀 Our AI Picked 6 Stocks that Jumped +25% in Q1. Which Picks Will Soar in Q2?Unlock full list

Yen jumps as investors stay cautious amid volatile stock moves

Published 12/28/2018, 09:54 AM
Updated 12/28/2018, 09:54 AM
© Reuters. FILE PHOTO: Swiss 1,000-franc notes are seen in this picture illustration

By Karen Brettell

NEW YORK (Reuters) - The Japanese yen jumped on Friday as investors sought protection against volatile stock moves, while the greenback dipped as stocks traded higher after a dramatic week capped by large price swings.

The benchmark S&P 500 (SPX) tested its 20-month low early in the week and was at the brink of bear market territory before the three main indexes roared back with their biggest daily surge in nearly a decade on Wednesday and a late rally on Thursday.

The yen gained despite higher stocks, soft domestic data and a decline in benchmark Japanese bond yields, which fell back into negative territory for the first time in more than a year.

“That suggests that there’s still demand for some insurance against extended volatility over the holiday period that’s keeping the yen better supported,” said Shaun Osborne, chief FX strategist at Scotiabank in Toronto.

The Japanese currency was last up 0.66 percent against the greenback at 110.26 yen. Another safe-haven currency, the Swiss franc , also jumped 0.82 percent to 0.9794.

"Markets are a bit more cautious on risk appetite, with the Japanese yen and the Swiss franc gaining," said Lee Hardman, an FX strategist at MUFG in London.

The dollar index, a gauge of the greenback against a basket of six major currencies, fell 0.22 percent to 96.265 (DXY).

The U.S. currency has been hurt in recent weeks by rising expectations that the Federal Reserve will pause its tightening cycle sooner than expected, or risk harming the U.S. economy with further interest rate increases.

© Reuters. FILE PHOTO: Swiss 1,000-franc notes are seen in this picture illustration

A partial shutdown of the U.S. federal government, trade tensions between the United States and China and complications relating to Britain’s exit from the European Union are also keeping investors cautious.

“There’s still a lot of potential risk and uncertainty out there,” said Osborne.

Both chambers of the U.S. Congress convened for only a few minutes late on Thursday, but took no steps to end the partial federal government shutdown before adjourning until next week.

Latest comments

Hopefully some gain for the USD, new year.But later JPY and CHF will take control again and so on...
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.