LONDON, Aug 2 (Reuters) – The yen was on monitor for its greatest run of positive aspects for the reason that depths of the coronavirus disaster in March 2020, as rising U.S.-China tensions over Taiwan and deepening worries a few international financial slowdown boosted the attraction of safe-haven property.
Towards the greenback , the Japanese forex was on monitor for a fifth consecutive session of positive aspects on Tuesday, taking its cumulative improve to just about 4.5% in 5 buying and selling periods. In early London buying and selling, the forex was up 0.6% at 130.78 yen, slightly below a excessive of 130.40 yen, a stage final seen in early June.
Jitters concerning the influence of an impending go to to Taiwan by U.S. Home of Representatives Speaker Nancy Pelosi weighed on shares and despatched traders scurrying into U.S. Treasuries. learn extra
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The benchmark 10-year Treasury yield fell to 2.516%, its lowest since April, additional narrowing the hole between ten-year U.S. debt and equal Japanese bonds to 236 foundation factors (bps), the bottom since early April.
The U.S. financial system shrank for a second straight quarter, knowledge launched final week confirmed, intensifying an ongoing debate over whether or not the nation is, or will quickly be, in recession, with merchants keenly expecting U.S. jobs knowledge on Friday. learn extra
“U.S. knowledge releases and the response in U.S. yields by means of the tip of this week might be vital as JPY momentum has constructed a substantial head of steam right here,” stated John Hardy, head of FX technique at Saxo Financial institution.
The Australian greenback fell practically 1.5% after the Reserve Financial institution of Australia raised charges by 50 bps to 1.85%, consistent with expectations. learn extra
The financial institution stated that although extra tightening was anticipated, it was not on a pre-set path, which some traders interpreted as future coverage tightening will not be as aggressive.
China’s offshore yuan touched 6.7957 per greenback, its weakest since mid-Could. Some analysts attributed this partly to the tensions round Pelosi’s go to in addition to poor financial knowledge from China over the weekend.
The greenback index , which measures the buck in opposition to six friends, rose 0.3% to 105.65.
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Reporting by Saikat Chatterjee; further reporting by Alun John in HONG KONG
Modifying by Mark Potter
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