The Japanese yen skyrocketed during the last days. The currency rose by 9.4% in a dozen trading days. And it is climbing to its largest three-day gain since the 2008 financial crisis. However, it’s not good news for policymakers in Japan. The exporters are also concerned, observing the trade closely.
Meanwhile, the Australian Dollar fell against the yen by 6% at an 11-year low. But the currency rebounded shortly from its drop to $0.6311, at last trading at $0.6540. The Kiwi also plummeted down by more than 7%.
Coronavirus cases have been growing rapidly. The number of infected surpassed 107,000 across the world. The virus caused more economic disruptions recently, as it reached more countries.
The oil prices fell sharply over the last days. Paul Mackel, head of emerging markets FX research at HSBC in Hong Kong, noted that this fall in the oil price came at the worst time, or at least that’s how financial markets are reading it.
He also added that volatility across assets is overshadowing any silver lining from a fall in the oil price. And it is hard to tell when fear and nerves will subside.
The oil price fell by 30%, on the other hand, causing massive sell-offs in oil exporters’ currencies. The Canadian Dollar declined by 1.6% to 1.3640 per dollar, its lowest point since 2017. The Mexican peso and the Russian rouble each fell as much as 6% against the Dollar. And the Norwegian krone declined by 3%.
What about the U.S. dollar and Euro?
The Dollar last dropped to a 17-month low against a basket of currencies. It also fell by 3% against the yen to 101.58. The currency declined against the Euro on Monday as the oil prices’ collapse combined with coronavirus fears drove U.S. yields at the lowest levels.
Investors rushed to the safety of bonds amidst the panic, sending 10-year yields under 0.5% and 30-year U.S. yields beneath 1%.
However, the Euro gained 1% at $1.1408, while the Australian and New Zealand dollars were down close to 2%.
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