Yen strengthens versus euro, sterling

Story link: Yen strengthens versus euro, sterling

The Japanese yen strengthened again on Monday as investors continued to exit risky carry trades, looking for investments that are more secure. Analysts said that investors are not yet panicked, but that it could start looking to investors like October 1998, when carry trades unwound and the dollar/yen collapsed by �18 in two days.

The yen was up 1.5 percent versus the greenback at one point during the day but eased back to �116.10 by mid-afternoon in New York, still 0.7 percent ahead of the dollar for the day. Meanwhile, the yen also added 1.3 percent to �152.20 in relation to the euro.

The yen was also higher in relation to sterling, which dropped 1.5 percent to �223.50 versus the Japanese currency. The Australian and New Zealand dollars both declined versus the yen, by 1.7 percent to �89.83 and by 2 percent to �78.62 respectively. The South African rand dropped 1.3 percent to the yen, to �15.55.

The US dollar was stronger versus the euro and sterling even though new data showed that the US services sector grew less in February than it had been expected to. The greenback was 0.7 percent higher versus the euro, to $1.3103 and it added 0.9 percent to $1.9260 against sterling.