Safe Haven Japanese Yen Back in the Limelight Over Worries of Increased US-China Tensions
The safe haven currency Japanese yen is back in favor and gaining against the US dollar after US President signed two bills into law to safeguard the human rights of the anti-government protesters in Hong Kong, angering Beijing. At the time of writing, USD/JPY is trading bearish at around 109.42.
On Wednesday, USD/JPY had strengthened on the back of optimistic economic data releases from the US. However, the bullish rally came to an abrupt end and the Guppy declined steeply after Trump signed the bills that allow the US government to impose sanctions on officials from China and Hong Kong who violate protesters’ human rights.
The yen found a reason to weaken following the release of retail sales data from Japan. According to government data, retail sales saw the steepest decline in over four years during October following the sales tax hike which was implemented on October 1.
Retail sales contracted by 7.1% YoY in October, the sharpest fall since March 2015. Economists were expecting a decline of 4.4% instead for this period.
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