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FOREX-Commodity currencies hit hard, yen climbs after Doha disappoints

Published 18/04/2016, 01:46 pm
© Reuters.  FOREX-Commodity currencies hit hard, yen climbs after Doha disappoints
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(Updates prices, adds analyst comment)

* Canadian, Australian dollars slide as oil slumps

* Yen broadly higher as risk aversion rises

* Oil producers fail to agree on output freeze

* U.S. Treasury Secretary's comments last week weigh on dollar/yen

By Ian Chua and Masayuki Kitano

SYDNEY/SINGAPORE, April 18 (Reuters) - Commodity currencies slumped on Monday while the safe-haven yen soared after major oil producers failed to agree on an output freeze, sending oil prices tumbling anew.

The Canadian dollar and its Australian counterpart were both marked more than 1 percent lower to as low as C$1.2986 per U.S. dollar CAD=D4 and $0.7594 AUD=D4 earlier on Monday.

Canada's loonie last traded at C$1.2953, still down about 1 percent on the day, while the Aussie was down 0.7 percent at $0.7670.

A plan for OPEC and non-OPEC producers deal to freeze oil production fell apart on Sunday after Saudi Arabia demanded that Iran join in, despite calls on Riyadh to save the agreement and help prop up crude prices. was some speculation ahead of this weekend's summit that an agreement to freeze crude oil production could be reached," analysts at Commonwealth Bank said.

The failure to secure a deal unsettled markets. U.S. crude futures CLc1 were last down 4.8 percent, while Brent futures LCOc1 dropped about 4.4 percent. rushed to the safe-haven yen, sending it to three-year highs against the euro. The latest move means the euro has given back the bulk of the gains made against the yen since the Bank of Japan launched its massive asset buying programme three years ago.

The euro hit a low of 121.71 yen at one point, its lowest level since April 4, 2013 - the day the BOJ launched its quantitative and qualitative monetary easing scheme. The euro was last down 0.8 percent at 121.82 yen.

The dollar came within a whisker of an 18-month trough of 107.63 yen JPY= set recently. The dollar touched a low of 107.75 at one point, and was last down 0.8 percent at about 107.96 yen.

The outcome of the meeting of G20 officials in Washington last week, and falls in Japanese equities on concerns about the economic impact from the deadly earthquakes in southern Japan, are also negative for the dollar against the yen, said Masashi Murata, currency strategist for Brown Brothers Harriman in Tokyo. in the yen has effectively become difficult," Murata said, referring to comments from U.S. Treasury Secretary Jack Lew late last week.

The United States offered a cool response to concerns voiced by Tokyo that the yen's gains are too sharp and may justify intervention, with Lew saying on Friday that he did not see any disorderly moves in the currency market. at Brown Brothers Harriman added that weakness in Tokyo shares can erode the risk tolerance of Japanese institutional investors and make them more cautious about overseas investment.

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