Yen is higher against other major currencies today as safe haven demand continues to drive Forex traders. With the uncertainty right now, yen is preferred for its stability and safety.
Disappointing Chinese factory data released yesterday sparked a global stock selloff. At one point the situation was bad enough in the Chinese markets that a new shutdown mechanism was triggered, suspending trading.
On the first trading day of the New Year, US markets tumbled, and they are still dropping, along with markets all over the world. In this climate, Forex traders are looking for something approximating safety. The yen represents one of the most traditional safe haven currencies. It doesn’t offer much in the way of yield, but it is considered stable and safe — and it’s in demand right now.
So far, the Bank of Japan hasn’t made any moves to curb the appreciation of the yen, and it is unlikely to do so unless the higher yen begins impacting the economy in negative ways.
At 15:02 GMT USD/JPY is lower, dropping down to 119.0760 from the open at 119.4270. EUR/JPY is experiencing an even bigger drop right now, falling to 127.9720 from the open at 129.3270. GBP/JPY is down as well, falling to 174.8640 from the open at 175.8340.
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