The Japanese yen rose in Asian trade on Tuesday against major rivals, extending the gains for the second straight session against the dollar and hitting a five-month high on mounting risk aversion and haven demand with massive US stock selloffs.
The gains are also underpinned by a drop in US 10-year treasury yields, which boosted the odds of a Fed rate cut in the first half of the year.
The Price
The USD/JPY fell 0.5% today to 146.54 yen per dollar, the lowest since October 2024, with a session-high at 147.27.
The yen rose 0.5% on Monday, the third profit in four days, as US yields and stocks dropped.
US Stocks
US stock indices marked their worst daily loss since September 2022 on Monday, plumbing six-month lows as investors flee the market on concerns about Trump’s tariffs and US recession.
The S&P 500 is now down 8.6% from its February 19 record high, losing $4 trillion of market value since then.
A series of controversial Trump policies spiked uncertainties for companies and consumers, with the worsening trade war damaging sentiment.
Japan’s Nikkei followed suit and lost over a thousand points, hitting six-month lows, as the US is Japan’s second largest trade partner.
US Yields
US 10-year treasury yields fell 0.8% on Tuesday, pressuring the greenback against major rivals.
Concerns are increasing about US growth, especially after weak US jobs data in February.
The odds of a Federal Reserve 0.25% interest rate cut in March are still standing at 5%.
