Yen Remains Strong against Most Currencies

By TraderVox.com

Tradervox.com (Dublin) – The yen remains strong against major peers, holding gains made yesterday. This has come amidst falling Asian stocks that has boosted the appetite for the currency as a safe haven. The Australian dollar dropped after a report showed that the economy expanded less than it had been forecasted in last year’s fourth quarter. The euro is another currency that increased against the US dollar due to speculations that it had reached a level that made the value of some contract worthless. However, the appetite for the euro was limited as the deadline for debt-swap deal for Greece approaches.

According to Satoshi Okagawa, the market is in a risk-off environment hence the yen is more likely to be bought than most other currencies hence the increase. Satoshi also estimate that the yen might strengthen beyond 80 per dollar today. The Japanese yen sold at 106.27 per euro at 11:00 am in Tokyo which was is a drop from yesterdays 106.07 in New York. The yen had gained 1.6 percent against the euro in New York trading session which is the sharpest increase since November 9 last year. The JPY remained unchanged against the US dollar at 80.89 yen. The euro increased by 0.3 percent against the dollar at the opening of the Asian session.

The MSCI Asia Pacific Index of share declined for the third day by 0.9 percent while the standard & poor’s 500 index declined by 1.5 percent. MSCI World Index dropped by 2.1 percent yesterday. Another index showing the volatility of the market today –the Chicago Board Options Exchange Volatility Index- closed at 20.87 yesterday which is the highest since February 15.

The Australian dollar dropped by 0.2 percent to $1.0536 after a report showed that the economy rose by 0.4 percent which is lower than the o.8 percent growth rate registered in the third quarter. The bureau of statistics released this report in Sydney today. According to Lee Wai Tuck, a Currency Strategist at Forecast LTD in Singapore, the talk of barrier options with a $1.3100 knock-out strike appears to be buying the euro to remain on the safe side.

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