|Bid||88.25 x 100|
|Ask||130.00 x 1300|
|Day's Range||91.05 - 91.62|
|52 Week Range||83.92 - 91.62|
|PE Ratio (TTM)||N/A|
|Expense Ratio (net)||0.40%|
The Japanese yen (JYN) managed to claw back its losses after the scare about a second round of tariffs hit the global financial markets last week. Japan’s February exports, March manufacturing, and inflation reports are expected this week.
The US Dollar Index appreciated for a fourth consecutive week due in part to the impressive industrial production and consumer confidence numbers that were reported at the end of the previous week. Earlier in the previous week, lower-than-expected inflation growth and retail sales numbers had little impact on the US dollar as markets have already priced in a rate hike from the US Fed at its March meeting. The turmoil in the White House had a marginal negative impact on the US dollar as the pressure from the Mueller probe reached the Trump businesses last week.
The Japanese yen (JYN) lost out to increased risk appetite thanks to softer-than-expected tariffs and the positive geopolitical development involving US President Donald Trump and North Korea’s Kim Jong Un. Also driving the yen higher were the comments from the Bank of Japan’s governor, Haruhiko Kuroda, who tried to take back his comments about the policy shift toward tightening. For the week ended March 9, the yen (FXY) closed at 106.80 compared to the US dollar (UUP), an appreciation of 0.99%.
The Japanese yen (JYN) regained its strength against the US dollar. The other factor that contributed to the yen’s appreciation was the comment from Bank of Japan Governor Haruhiko Kuroda. Kuroda used the word “exit” when referring to the central bank’s accommodative monetary policy program.
The US Dollar Index closed the previous week with minor gains, but the index suffered after the announcement about tariffs last week. Historically, US tariffs on imports have been negative for the US dollar. If the current proposal becomes a law, the US dollar could have a similar fate.
The Japanese yen (JYN) gave up some of its gains in the previous week as the US dollar appreciated on the back of the increased odds of US rate hikes in the near future. The US dollar received a boost from the FOMC meeting minutes, which indirectly had a negative impact on the Japanese yen. Improved economic indicators from Japan did little to boost the yen last week.
The US Dollar Index returned to strength as risk appetite remained stable and the FOMC minutes signaled further tightening through interest rate hikes. Higher interest rates in the US could lead to the appreciation of the US dollar against its trading partners. The other reason for the US dollar’s appreciation is the weakness in the euro, which was triggered by the dovish statement from the European Central Bank.
The Japanese yen (JYN) managed to hold on to its gains from the past two weeks despite the increase in risk appetite. The Japanese yen is considered a safe haven in times of market sell-offs and had seen increased demand during the recent market correction. The surprise was that the yen held on to its gains during the market rebound.
Is Volatility Set to Drop Further after Stock Market Rebound? The US Dollar Index, whose slide had been stalled in the past two weeks, saw losses as markets recovered last week. Better-than-expected inflation growth should have increased the demand for the US dollar, but the surprise reaction of equity markets was also seen in the forex markets with the US dollar sliding against the major currencies.
The Japanese yen (JYN), along with the US dollar, saw a sharp increase in demand as risk aversion gripped global markets. The yen is considered a safe haven in times of market sell-offs because of its current account surplus. In the week ended February 9, the yen (FXY) closed at 108.80 against the US dollar (UUP), appreciating by 1.2%. Japanese equity markets (EWJ) fell sharply, reacting to the global market sell-off, with the Nikkei 225 (JPXN) posting a loss of 8.1% in the week ended February 9.
The first market sell-off in two years has directed attention to inverse equities ETFs, which took first place in the list. Infrastructure ETFs are again in vogue after U.S. President Trump said he will focus his efforts on devising a spending package to fix the country’s crumbling bridges and airports. Amid an unassertive flight to safety, gold ETFs took third place in the list, while volatility was last. Aerospace & defense ETFs also trended, taking fourth position. Check out our previous trends edition at Trending: Netflix Hits $100 Billion Mark After Record-High New Subscribers.
The Japanese yen (JYN) retracted against the US dollar last week as US dollar bulls tried to take control. A hawkish Federal Reserve along with a strong jobs report and wage growth gave some reason for the dollar bulls to cheer, and that resulted in a decrease in demand for the Japanese yen. For the week ended February 2, the Japanese yen (FXY) closed at 110.16 against the US dollar (UUP), depreciating 1.3%.
The Japanese yen (JYN) was the only major currency that was unable to benefit from the weakness in the US dollar (UUP), although that trend changed during the week ended January 12. During the week, the yen (FXY) closed at 111.04 against the US dollar (UUP), compared to 113.08 in the week ended January 5, appreciating by 1.8%. The boost to the yen came from the US dollar’s weakness and the comments from Bank of Japan governor Haruhiko Kuroda, who expressed confidence about the Japanese economy.
Speculation is rife that the trade tension between the U.S. and China will increase this year. First, the latest Blomberg report states that China may slow down, or even stop, the purchase of U.S. government bonds, citing that U.S. debt has become less attractive than other assets. Since China is the biggest buyer of U.S. sovereign bonds holding $1.2 trillion of U.S. debt, the action could lead to a broad sell-off in the equity markets.