The yen hit a four-week high against the dollar as speculations suggest that the swine flu will deepen the global slump.
In these times of crisis the yen has been used by investors as a refuge, and as bad news continue to appear in different parts of the world, the bullying trend for the Japanese currency is likely to continue. The swine flu is already infecting the financial markets with significant pessimism, the Mexican peso has been the most affected currency for the moment, but other high-yielding assets from emergent-markets also are been punished by the swine flu. Societe Generale, a leading French bank, reported losses, which contributed to weaken the euro against the yen.
A combination of pessimistic events has marked this Monday in financial markets across the world: losses in French banks and speculations that a pandemic catastrophe may strike the world made the analysts to suggest that risk aversion currencies, such as the yen, are the best bet in the current scenario of instability. Since the beginning of this month, the yen has posted gains against most of major currencies, as uncertainty grows.
The USD/JPY traded at 96.54 falling from 97.25 which was the closing price last Friday. The EUR/JPY fell to 126.88 from 128.25. A similar movement followed in the GBP/JPY falling from 142.35 to 140.26.
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