Yen Strengthens Amid Risk Aversion
19 Juni 2018 - 05:42AM
RTTF2
The Japanese yen gained ground against its major counterparts in
the Asian session on Tuesday, as Asian shares fell after U.S.
President Donald Trump threatened more tariffs on Chinese goods in
an escalating tit-for-tat trade war between the world's two biggest
economies.
Trump threatened on Monday to impose new tariffs on $200 billion
of Chinese goods, unless China refuses to change its practices.
China responded swiftly, saying "If the US acts irrationally and
issues a list, China will have no choice but to take comprehensive
measures of a corresponding number and quality and take strong,
powerful countermeasures."
China's Commerce Ministry criticized the White House action as
blackmail, triggering concerns of a full-blown trade conflict that
could derail global growth.
The yen, perceived as a safe-haven asset, is often sought during
market turmoil and political tensions.
The yen climbed to an 8-day high of 109.55 against the
greenback, after having fallen to 110.57 at 6:15 pm ET. The next
likely resistance for the yen is seen around the 108.00 level.
The yen advanced to a 2-1/2-month high of 82.73 against the
loonie and near a 3-month high of 80.64 versus the aussie, off its
early lows of 83.77 and 82.09, respectively. The yen is seen
finding resistance around 81.00 against the loonie and 79.00 versus
the aussie.
The yen strengthened to near 3-week highs of 126.80 against the
euro, 144.64 against the pound, 110.19 against the franc and 75.54
against the kiwi, from its previous lows of 128.51, 146.47, 111.09
and 76.72, respectively. The next possible resistance for the yen
is seen around 125.00 against the euro, 142.00 against the pound,
108.00 against the franc and 74.00 against the kiwi. Looking ahead,
Eurozone current account and construction output for April are due
in the European session.
At 4:00 am ET, the European Central Bank President Mario Dragi
will speak at the ECB Forum on Central Banking in Portugal.
In the New York session, U.S. housing starts and building
permits for May are scheduled for release.
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