The yen had a week of losses against the euro and the dollar, as the first signs of economic recovery appear in China and in the U.S.
The dollar rose against the yen after Chrysler LLC filed for bankruptcy and will ally the Italian Fiat SpA with the investment of federal funds, as President Barack Obama confirmed this Thursday. The euro has posted favorable news about the Eurozone consumer confidence and companies like Siemens AG reported earnings, making the European currency to hit a two-week high against the yen. Concerns that the swine flu could take pandemic catastrophic dimensions also eased after the disease was found to be not so lethal, which increased optimism on global markets this week.
Investors are hopeful and certain that solid evidences from an economic recovery in China and in the United States are pushing the markets up, which due to the consequences of the global financial turmoil, had several months of consecutive losses since last year, when the recession started. Analysis indicate that the yen, an investment considered as a refuge, is very likely to lose popularity, as risk appetite will be triggered by better economic conditions.
The EUR/JPY strengthened from 129.55 to 131.72 and the USD/JPY is on its way to hit the 100 mark, being traded at 99.34 from 97.30 in the intraday comparison.
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