FX & CFD trading involves significant risk
The yen weakened for a second day as Japan made progress in cooling nuclear reactors at a crippled plant, increasing appetite for higher-yielding assets.
The yen extended losses after sliding the most against the dollar in six months on March 18, when the Group of Seven nations intervened to bring the currency down from a postwar high.
The yen surged to a post-World War II high of 76.25 versus the dollar on March 17 after a 9.0-magnitude earthquake and tsunami struck Japan on March 11, damaging cooling systems at a nuclear-power plant north of Tokyo. The currency’s gain came amid speculation investors were repatriating assets to fund an estimated 10 trillion yen ($123.6 billion) for reconstruction.
Japan’s Prime Minister Naoto Kan said today he sees “light at the end of the tunnel” for Japan’s crisis and that progress is being made in restoring power to reactors at the Fukushima Dai-Ichi nuclear plant.
The G-7, which comprises the U.S., Japan, Germany, the U.K., France, Canada and Italy, sold yen on March 18 after finance ministers spoke on a conference call, according to Japan’s Vice Finance Minister Fumihiko Igarashi. The G-7 statement promised to “provide any cooperation” with Japan.
“Today there is a bit of relief that the situation in Japan is not deteriorating,” which is damping demand for the Swiss franc, said Arne Lohmann Rasmussen at Danske Bank A/S in Copenhagen.
Euro-area finance ministers plan to meet in Brussels to further develop a package of measures on the region’s debt crisis and economic governance. European Union leaders will hold a summit March 24-25 to discuss the measures.
The Australian and New Zealand dollars climbed for a second day as higher oil prices increased demand for currencies linked to commodities. Crude oil futures rose as much as 2.3% in New York.
All posted material is a marketing communication solely for informational purposes and reliance on this may lead to loss. Past performance is not a reliable indicator of future results. Please read our full disclaimer.