Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

FOREX-Yen sours as risk appetite returns, Aussie focused on GDP

Published 02/03/2016, 10:31 am
Updated 02/03/2016, 10:40 am
© Reuters.  FOREX-Yen sours as risk appetite returns, Aussie focused on GDP
EUR/USD
-
USD/JPY
-
AUD/USD
-
USD/CAD
-
EUR/JPY
-
US500
-

* Dollar back above 114.00 yen, euro near 124.00 yen

* Encouraging U.S. data whets risk appetite, hits safe-haven yen

* Aussie dollar eyes GDP data due at 0030 GMT

By Ian Chua

SYDNEY, March 2 (Reuters) - The yen nursed broad losses early in Asia on Wednesday, having suffered a big reversal overnight as traders in London and New York took a brighter view on the global economy and dumped the safe-haven Japanese currency.

Helping to turn sentiment around was encouraging U.S. factory and construction data, which offered hope the economy was regaining momentum. U.S. stocks .SPX staged their biggest one-day rise in a month and closed at their highest since early January. euro rebounded towards 124.00 yen EURJPY=R , from a near three-year trough of 122.085, a punishing move for those who had bought the Japanese currency during the Asian session on Tuesday.

The greenback rose to its highest in nearly two weeks at 114.185 JPY= on the back of a 1.2 percent rally. Enjoying gains of more than 1.5 percent, the Australian dollar powered towards 82.00 yen AUDJPY=R , while its New Zealand peer popped back above 75.50 NZDJPY=R .

"The risk-on sentiment has relegated the yen to the bottom of the leader board over the past 24 hours. The improvement in sentiment has also provided a lift to commodity prices and as a result commodity-related currencies have outperformed," analysts at National Australia Bank wrote in a note to clients.

Further diminishing the allure of the yen was talk of more stimulus from Japanese authorities, though this time the chatter centred on fiscal measures, rather than monetary policy action. Europe, the expectation is for further easing from the European Central Bank (ECB) at next week's review. ECB President Mario Draghi on Tuesday said the meeting would have to take into account weaker prospects for growth and inflation. common currency was little changed on the greenback at $1.0868 EUR= , pinned near a one-month trough of $1.0834 set on Tuesday.

Business surveys outside the United States were more sober, with manufacturing output across much of Asia shrinking in February and waning throughout Europe. the best performing major currencies was the Canadian dollar, which scaled a three-month peak of C$1.3550 per USD CAD=D4 after economic growth data beat forecasts.

The Aussie flirted with 72 U.S. cents AUD=D4 , having drifted up from Tuesday's low near 71 cents. Further gains will depend on local gross domestic product data due at 0030 GMT.

Analysts polled by Reuters expect economic growth to have slowed to 0.4 percent in the fourth quarter, from 0.9 percent, keeping the annual growth rate steady at a sub-par 2.5 percent. (Editing by Richard Pullin)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.