As investors continued to worried over the tension in Syria and North Korea, safe-haven such as gold and crude oil, the Japanese Yen also rallied hitting a five-month against a basket of other major currencies on Wednesday.
This was brought about by the U.S. military redirecting a naval strike group to North Korean waters raising fears of a military strike against the country following U.S. President Donald Trump’s launch of 59 Tomahawk cruise missiles at a Syrian airfield in reaction to a chemical attack supposedly ordered by the Syrian government.
The dollar declined below ¥110 for the first time since last year’s election where Donald Trump was announced as the new president of the United States while the yen recorded new fresh highs to ¥109.50 per dollar.
Following the yen’s rise, Japanese core machinery orders rose 1.5% from the past month although it did not meet analysts expectations. According to analysts, geopolitics are currently the focus of the government and the markets with a number of Australian mining stocks rising by around 2% on Wednesday as Gold prices rose 1.6% to almost $1,280 per troy ounce.
Dollar At 5-Month Decline Against Yen
The US dollar dropped to its lowest level in the past five months against the yen as the rising geopolitical tensions drove investors away from riskier assets such as stocks to
The selloff in the greenback was proven by the rising bids and options build around the 110 yen level and eventually breaking out of the price level showed how much the dollar has been sold the same day. The euro also declined by more than 1% overnight making it hit a five-month low against the yen although it performed better than the US dollar with the common currency recording overnight gains up by 0.1% to $1.0610.
The dollar touched the 109.745 yen prior to touching the 109.535 in the previous session which was its lowest since November last year.
This would be the first time that the Japanese yen breached the 110.10 level since last year and has risen about 5.8% since the beginning of the year. Yen which has been popular among investors recently as a safe haven asset most especially during uncertain periods in the forex market.
The Yen is now expected to continue to rise over the week as worries over the geopolitical tension