On Tuesday, the yen traded near low to the dollar as safe-havens lost ground after Wall Street’s rally. It also resulted from Omicron uncertainties.
The Japanese currency weakened and appeared 114.936 yen per dollar for the first time since the end of November. It previously approached the year-to-date low of 115.526.
On Monday, the S&P 500 ended at its record high after the robust U.S. retail sales data lessened concerns from the highly infectious Omicron variant. Previously, the variant has forced thousands of flight cancellations and other delays during the Christmas holidays.
The U.S. dollar continued to decline toward the bottom end of its recent trading field. It happened even after a hawkish rise at the Federal Reserve. Fed policymakers were signaling three quarter-point interest rate increases in 2022.
Overview
The dollar index seemed little changed from the previous session at 96.077.
Head of G10 FX strategy at Citigroup Global Markets Japan, Osamu Takashima, said that markets seem optimistic worldwide that Omicron won’t derail the economic recovery, reducing demand for haven currencies, especially the yen.
He said that the U.S. equities rally means that investor risk appetite must be robust despite anticipations for faster Fed tightening. He also predicted that the yen would likely test its low this year in the near term.
Sterling often increases when risk sentiment improves. It held close to the one-month high of $1.3446 reached overnight.
Experts consider the Australian dollar a liquid proxy of risk appetite. It inched up back toward a four-week high at $0.6851, reaching Friday.
The euro also changed near the top of its range against the dollar this month. It appeared little changed from Monday at $1.13256.
Changes in the market are apparent. Some currencies appear lower as concerns about the new strains grow. They also experience some other uncertainties.
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