The yen has been trading at record highs during Friday’s Asian session, against its fellow safe haven counterpart (the US dollar) and resource linked currencies (the Canadian, Australian and New Zealand dollar).
The Japanese currency jumped to a high of 79.29 versus the US dollar. The yen traded at 76.94 versus the Canadian dollar, 78.16 versus the Australian dollar and 60.54 versus the New Zealand dollar.
The yen was also at its highest level against the euro in 2 days, trading at 99.33. It also gained against the Swiss franc, trading at 82.71.
For more cues, foreign exchange traders will be looking at Japan's Eco watchers survey results and bankruptcy data for May 2012.
US dollar on bearish run against currency counterparts
The US dollar continued its bearish run against its foreign currency counterparts, with global indicators generating an appetite for riskier currencies. The dollar was down against the euro (EUR/USD at 1.2523) on the news that the Spanish bond auction had been more successful than expected.
The US dollar also depreciated against the Australian dollar, with the Australian Employment Change figure beating expectations. The Australian dollar was at 0.986 US dollars at 07:00 GMT on Friday.
The US trade balance will be released today; it will be an important piece of data for foreign exchange traders. If the data is at or above expectations, then the US dollar could register some gains against other currencies. However, these are likely to be temporary gains.
Spanish bond auction helps euro advance
Investors surprisingly showed a better than expected response to the Spanish bond auction yesterday. However, in yesterday’s American trading session, the euro reduced in value against the dollar and yen.
The US Federal Reserve Chairman’s non-committal statement on quantitative easing in the US helped reduce the euro’s value against the dollar.
At 04:50 GMT, the euro was at 1.2523 USD, down from1.2562 USD. Against the yen, the euro was trading at 99.30 yen, down from 99.99 yen earlier. The pound, however, has been strong against the euro. If UK PPI input figures are positive, then the pound can be expected to rise against the euro.
Foreign exchange traders will be looking to close the week on a high, and for the euro to take positive cues from the global economic developments.
Crude oil prices show volatility
Crude oil prices are expected to elevate slightly in the US session on Friday, after a slight fall in Thursday’s session. Oil prices have been taking cues from Federal Reserve Chairman Bernanke’s comments. Bernanke offered no clue on monetary easing, but indicated that the Federal Reserve was watching the US economy closely.
On the New York Mercantile Exchange, crude for July 2012 delivery was down by 20 cents and closed at $84.82 a barrel. Friday’s Asian session saw Brent crude fall below $99, due to the uncertainty caused by Bernanke’s statements.
Oil traders feel that the focus of the oil market keeps shifting between European worries as well as slowing American economic growth. Even news from China is not as positive as it should have been. Chinese Central Bank rate cuts may indicate that the Bank is worried about poor economic data for May 2012, which is yet to be released.
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