The yen reached its highest in 16 months against the dollar thanks to the rising worries over global trade tensions sparking another round of risk aversion for traders. The dollar fell to 103.635 yen in early trading on Friday, its lowest level since November 2016. The euro reached 128.96 yen – its lowest since August 2017. The dollar index, which tracks the greenback against a group of major rivals, closed at 89.718.
The yen is considered a safe haven currency and is often sought after in times of political and economic uncertainty. This is attributed to Japan’s current account surplus.
Shares in Europe and Asia closed in the red zone on Friday as increasing fears of a possible global trade war loomed over the stock and currency markets. The pan-European Stoxx 600 fell by 0.82 percent briefly following its opening stages with a majority of the sectors in the negative.
In Asia, Japan’s Nikkei 225 index went down by 4.51 percent and closed at 20,617.86. South Korea’s Kospi index dropped by 3.18 percent and closed at 2,416.76. Hong Kong’s Hang Seng index went down by 3.16 percent. In the mainland, the Shanghai composite closed at 3,153.09 and the Shenzhen closed at 1,766.61.
Investors are currently shifting focus to the initial public offering of Deutsche Bank’s asset management arm DWS that will be happening soon. It is said that the IPO will bring approximately $1.7 billion to Deutsche Bank.