Market News

With China’s industrial output figures showing better-than-expected improvement last month, the U.S. Dollar Index slipped to a 1-year low versus a basket of major currencies in Asian trading today.

The U.S. Dollar continues to be on the defensive in Tokyo trading today, remaining poised near its lowest price this year.

As reported at 3:21 p.m. (JST) in Tokyo, the U.S. Dollar is struggling to recover from its lowest point versus commodity-linked currencies such as the New Zealand and Australian Dollars. Versus the single currency Euro, the greenback is floating close to its lowest price this calendar year as investors shift their funds into higher-yielding, albeit higher-risk currencies.

With investors trimming their buy positions, growth-linked, generally high yielding currencies, came close to approaching their 1-year high versus the Japanese Yen. Appetite for higher risk assets such as the New Zealand and Australian Dollars was somewhat lukewarm in Asian trading today, as investors wait for the U.S. market to reopen following a national holiday yesterday.

The USD and JPY were weaker on Monday while the commodity-linked AUD hit a one-year high after investors focused their attention on the full half of the cup regarding a mixed U.S. payrolls report.

The recent release of Gross Domestic Product data from Australia indicated that the country’s economic growth was better and faster at .6% than had been originally expected for the second quarter of 2009, helping to prop up the Australian Dollar versus the Japanese Yen which was forced to retreat from a 6-week high versus the AUD.

With Japan’s opposition party winning yesterday’s election in Japan, the Japanese Yen touched on a 7-week peak against major currencies. Versus the U.S. Dollar, the Japanese Yen traded at 92.54 Yen, a gain of nearly 1% on the EBS trading platform.

In Friday’s trading in Tokyo, the U.S. Dollar traded mixed. As reported at 3:17 p.m. (JST), the U.S. Dollar Index, which is a measure of the greenback’s value versus a group of major currencies, edged up to 78.089 .DXY, an increase of .1%.

Concerned investors, worried that the recent rally in high-risk currencies has reached an end, moved back into the safe-haven of the Japanese Yen, pushing the Yen up broadly in Asian trading today.

Returning earlier gains, both the U.S. Dollar and the Japanese Yen declined in Asian trading today, as the volatility of China’s share prices rose, prompting investors to move back into commodity-linked, high yielding currencies.

As reported at 2:34 p.m. (JST) in Tokyo, the Japanese Yen saw broad gains in Asian trading today as share prices fell and risk appetite for higher-yielding currencies waned.

As reported at 9:03 a.m. in London, the Japanese Yen fell against both the single currency Euro and the U.S. Dollar as gains in equity markets whetted risk appetite and pointed investors toward high-risk/high-yield currencies.

Chinese share prices again are providing the momentum for the Japanese Yen’s movement versus other major currencies, as investors worry about the possibility of continued weakness in the market, and moved out of higher-risk currencies.

A recovery in global share prices whetted the risk appetite for high-yielding currencies and pushed the Japanese Yen down in trading today.