Yen Climbs On Risk Aversion
June 01 2012 - 6:29AM
RTTF2
The Japanese yen spiked up against other major currencies in the
European session on Friday as investors sought safe haven assets
amid weak PMI data from major European economies.
Eurozone manufacturing activity deteriorated at the strongest
pace in nearly three years in May, detailed results of a survey
conducted by Markit Economics showed.
The seasonally adjusted purchasing managers' index, a
performance indicator for the manufacturing sector, fell to 45.1 in
May from 45.9 in April. This was marginally above the flash
estimate of 45.
Also, data from a survey by Markit Economics and the Chartered
Institute of Purchasing and Supply (CIPS) showed that the British
manufacturing sector contracted for the first time in six months in
May, as companies scaled back production and employment as inflows
of new business declined sharply.
The seasonally adjusted purchasing managers' index (PMI) for the
manufacturing sector dropped to 45.9 in May from 50.2 in April,
hitting the lowest level in three years.
Against the European single currency, the yen hit a new 11-year
high of 96.20. The next upside target level for the yen is seen at
91.5. At Thursday's close, the pair was worth 96.85.
The yen that closed Thursday's trading at 80.66 against the
franc and 78.32 against the U.S. dollar hit a new 5-month high of
80.12 and a fresh 3-1/2-month high of 78.12, respectively. The next
upside target level for the yen is seen at 79.00 against the franc
and 77.8 against the greenback.
Switzerland's retail sales were broadly unchanged in April,
following strong growth in the previous month, data released by the
Federal Statistical Office showed.
Total retail sales edged up a calendar-adjusted 0.1 percent,
after March's upwardly revised 4.7 percent growth. Excluding fuel,
retail sales fell 0.3 percent, in contrast to March's 4.3 percent
gain.
Against the pound and the New Zealand dollar, the yen spiked up
to a new 4-month high of 119.30 and a fresh 5-1/2-month high of
58.44 with 118.5 and 58.00 seen as the next upside target levels,
respectively. At yesterday's close, the yen was worth 120.68
against the pound and 59.03 against the kiwi.
The yen also advanced to a fresh 6-month high of 75.28 against
the Australian dollar and a new 4-1/2-month high of 75.14 against
the Canadian dollar, when compared to yesterday's New York session
close of 76.25 and 75.85, respectively. On the upside, the yen may
target 74.00 against the aussie and 74.5 against the loonie.
Looking ahead, US jobs data for May, construction spending for
April, ISM manufacturing data for May and Canada GDP data for March
are due in the New York York morning session.
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