Yen Gains as World Economy Outlook Worsens

The Japanese yen rose against all other major currencies today as the traders reacted on the possible bankruptcy of the U.S. automakers and the global optimism for the emerging stock markets and the high-yielding currencies declined.
The yen rose to the highest level in a week against the U.S. dollar and the 2-week maximum against the euro as the Asian stock markets slumped and the Japanese Nikkei benchmark index fell by more than 4 percent today. The traders and investors expect more losses from the financial sector, while the emerging markets suffer from the highly probable further decline in exports.
The  U. S. dollar also rose against the British pound and the euro as the Forex market participants expect that the European Central Bank will have to cut the interest rate to the lowest level since the single European currency was first introduced in 1999. The ECB monetary policy meeting is scheduled for April 2.
The analysts stress the situation with the U.S. automakers as one that spurs the risk-averting trends on the markets. The traders run into «safe haven» yen as the primary security and the U.S. dollar as the secondary one. The uncertainty in the real and financial sectors will be keeping these two currencies strong.
USD/JPY fell from 98.09 to 95.94 as of 9:22 GMT today. EUR/JPY opened with a rather wide weekly gap — 129.74 from 130.03 and the declined to 126.94. GBP/JPY went down from 139.63 to 136.17 today.

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