Yen holds gains near 17-month high versus USD

The US dollar hovered at seventeen-month lows against the yen on Wednesday. Risk -off sentiment in the markets helped strengthen the Japanese currency which is usually seen as a safe haven asset.

The yen hit Y109.95 per dollar during the US trading session on Tuesday, its highest level since October 31, 2014 when the Bank of Japan boosted the size of its asset stimulus programme. It was sitting 0.1 per cent lower at Y110.49 in Asian trade today.

Meanwhile, the US dollar is under pressure due to dovish remarks last week from Federal Chair Janet Yellen, who indicated caution over the US interest rate outlook.

The Australian dollar, which tumbled against the greenback yesterday to $0.7510, recovered slightly today to $0.7559 following some improved data out of China, which is Australia’s major trading partner. The Caixin survey on China’s services sector climbed higher into expansionary territory in March, which helped pull the overall composite reading, which includes activity in manufacturing sector, back over the expansionary threshold of 50 points.

In commodities, gold, which is sensitive to interest rate expectations, was 0.2 per cent lower at $1,229.41 an ounce today, after a 1.3 per cent jump on Tuesday. The dollar index, a measure of the US currency versus a basket of global peers, was 0.1 per cent higher again today at 94.709.

Oil prices rebounded today on renewed hopes major producers would reach an agreement to freeze output. Brent crude, the international benchmark, was 1.7 per cent higher at $38.52 a barrel, while West Texas Intermediate, the US marker, was 2.7 per cent higher at $36.87.

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