FOREX Safety: Bend raises yen After PM fired, euro falls to equities – Rayrice Forex News

FOREX Safety: Bend raises yen After PM fired, euro falls to equities

  • Yen’s flight to safety
  • The euro dropped to a 20-year low to $ 1.00720.
  • Stable or strong U.S. jobs data could boost the dollar – analysts say

LONDON, July 8, 2010 (FBC) – Former Japanese Prime Minister Shinzo Abe was shot dead as he campaigned for a parliamentary election last Friday, raising questions about Yen and the US dollar.

The 20-year-old euro is depreciating against the dollar and Europe is in for a worse week in four months, with markets waiting for US labor data.

Abe was shot dead in the western city of Nara on Friday, and Prime Minister Fumiyo Kishida Abe said he was in critical condition. Read more

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The yen rose 0.5% immediately after the news. At 0810 GMT, the dollar rose 0.2% to 135.81.

“I think Yen’s safe place is playing a role,” said Bart Wakabayashi, manager of the Tokyo State Road Branch.

“The FX market players (by the way) are very entrenched,” he said, instinctively buying dollars and the bad news.

Investors are worried that the crisis over Russia’s gas supply could lead to the continent’s collapse. The euro has fallen 3.2% against the dollar this week.

The single currency has fallen 0.6% to $ 1.01005 against the dollar, hitting a new two-decade mark of $ 1.00720. Its decline has helped the US dollar index to rise for more than two decades. On Friday, the dollar rose 0.5% to 107.560 against the exchange rate.

“In Germany, EU gas prices and energy supply signals a serious threat to the eurozone’s economy,” said Jeremy Strech, head of CIBC’s G10 FX strategy.

Sterling is set for its second consecutive weekly decline, but traders said the 1.8% fall this week was relatively modest in the wake of British political turmoil released by Prime Minister Boris Johnson. The pound fell 0.65% to $ 1,1948 a day.

Investors are worried about the US economy, although recent data have been more than expected, despite rising energy prices, which are likely to keep pace with confidence and growth in Europe.

USNFAR = ECI at 1230 GMT is the next indicator, with economists forecasting 268,000 jobs added in June.

Stronger numbers may alleviate some of the downside worries, but they may also lead to increased betting and increase the dollar.

“Strong wage gains encourage strong federal policy,” said Carol Kong, chief strategist at the Commonwealth Bank of Australia in Sydney.

The two Federal Reserve’s most vocal hawks have said they will support another 75-point interest rate later this month, but will later turn to slower pace. Read more

The dollar has long been on the rise in emerging markets, this week moving several Asian currencies to record lows and the Indian rupee to record.

Bitcoin has seen a recovery rate, meanwhile, gaining about 13.5% a week to $ 21,800.

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Reporting by Joyce Alves and Tom Westbrook; Correction by Toby Chopra

Our Standing Principles Thomson Reuters Trust Principles.


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