U.S. Dollar Increases against Yen
The U.S. dollar on Monday increased against the yen. However, the
gains were held in check due to the ongoing concerns about the U.S. – China trade
war and following the weaker-than-expected U.S. jobs report last Friday.
USD/JPY went up 0.17 percent to 107.10, after closing Friday’s
session down 0.42 percent.
Last Friday, the dollar fell as fresh fears over the prospect of a
possible trade tension between the world’s two largest economies, U.S. and
China, and the disappointing employment data weighed.
Meanwhile, the safe haven yen tends to be sought out by investors
during times of political or economic uncertainty.
According to China, the country was prepared to hit back “forcefully”
if U.S. President Donald Trump pushed through the threat to impose $100 billion
in additional tariffs on imports.
The concerns that protectionist trade policies might effect in a full-blown
trade war have sparked worries over the impact on the global economy and U.S.
growth, however investors are still hopeful that negotiations will result in a settlement.
On the other hand, the U.S. dollar index, which measures the strength
against a trade-weighted basket of six major currencies of greenback, increased
0.1 percent to 89.92.
The dollar, however, showed a little reaction after reports of a
suspected U.S. missile attack on a major Syrian air base. Meanwhile, Washington
denied that it had launched any air strikes against the state.
The euro dropped lower, with EUR/USD falling 0.11 percent to
1.2268, holding above the one-month low of 1.2215 seen ahead of the U.S. jobs
data last week.
According to the report of the Labor Department, the U.S. economy
added the fewest job in six months last month. However, the wage growth
slightly went up, which indicates that the labor market is remaining to tighten.
Meanwhile, Sterling was nearly unchanged against the dollar, with
GBP/USD last seen at 1.4096.
Turkish Lira Drops
Turkey’s lira fell to new records against the U.S. dollar and euro
as the concerns of investors about the overheating economy and unresponsive
central bank mounted.
The currency went down past 5 per euro and 4.07 per dollar in Istanbul.
This year, it has decreased nearly 9 percent against the euro. It is the worst
performance in emerging markets under Argentina.
Meanwhile, investors have called for higher interest rates to
moderate an economy that they say are overheating, but Turkey responded with a
series of stimulus measures pointed at boosting growth.
“This mismanagement of the currency leads to a loss of confidence
in the purchasing power of the lira which is hard to cure,” stated Lutz
Roehmeyer, who helps oversee about $$14 billion at Landesbank Berlin
Investment.
“Only massive one-off hikes can heal this situation, which is of
course not popular as it slows the economy,” Roehmeyer added.
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U.S. Dollar Increases against Yen
Reviewed by fsmsmart
on
April 09, 2018
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