The japanese yen is strong, then a week where the dollar lost its role in the Forex market against other currencies. It is time for the Yen to overcome their positions.
Currencies like the Chinese Yuan, the Euro, and now, the Japanese Yen, have been traced in the market of foreign currency over the dollar, as investors begin to find safety in other currencies apart from the dollar.
The american currency is being increasingly minimized to other currencies at the moment of bend that the united States is going through. The analysts believe that the dollar will be uphill to regain its previous position.
Why the dollar has lost ground?
The news of the Forex market have been uploaded this week of firsts on the ski lift in currencies other than the dollar. And this was a scenario which the analysts envisioned.
Since the start of the pandemic by the coronavirus, the united States has been one of the countries that minor measures taken to control infections and to curb the spread of the coronavirus.
To date, there is 3.7 M of confirmed cases in the u.s. territory.
On Thursday, there were more than 60,000 new cases of COVID-19 throughout the united States, the largest count of a single day by any country in the global pandemic until the time, which discourages some u.s. consumers to return to public spaces.
This has led investors to tread carefully when considering investing in the dollar.
Therefore, the currency green had become the safe haven of investors at the beginning of the pandemic, but, as the other economies are recovering slowly, the us dollar is slowly being displaced.
The renewed strength of the Japanese Yen
The japanese yen is strengthened, and is now on the way to register their largest gain percent daily against the dollar in about a month. Being one of the currencies that soared into the Forex market to the weakness of the dollar.
Therefore, the dollar fell against a basket of main currencies. Fall down by a united States weaker than expected for investors.
Then it came to the statistics of the producer price index in Japan and the U.S., The japanese yen gained against the us dollar by the clear advantage in these figures of the Yen on the american currency, changing direction from the interest of the investors.
The japanese data showed that the PPI rose 0.6% in June after falling 0.5% in the previous month. The prices have decreased by 1.6% year-on-year.
Which is understandable because there was no pandemic in 2019. These figures arrived a few days before the Bank of Japan published its decision on the interest rate.
The data on PPI in the united States remained in the negative figure of -0.8%, not meeting forecasts of analysts, and generating even more uncertainty for investors because, every time it seems that the american currency is about an environment not favorable for investment.
“Concerns about the growth stalks the markets, boosting safe bets such as the japanese yen and gold.”
Joe Manimbo, senior analyst of the market, at Western Union Business Solutions in Washington.
An uncertain future for the dollar
An uncertain future for the dollar
The dollar continues its history of losses for this end of the week. Although the investors saw the heart as the american currency gained in the trading hours of asian descent, lost momentum and remained nearly flat against a basket of currencies that promise you more confidence to investors.
The times of uncertainty for the currency to last a little longer. So now not only is the anxiety caused by the coronavirus which separates the investors, if not that are increasingly close to the primaries of the presidential candidates to the presidency of the united States.
And international opinion is becoming increasingly tense with the options of candidacy. Because, Trump and Biden, does not have very good reception internationally due to the drastic changes that promise the economic system by the american.
Quotation of the Japanese Yen to the date
At the time of the writing of this article, USD/JPY is traded at 106.89, winning the japanese yen against the dollar.
The japanese yen strengthens against the other currencies on the Forex market. Source: Yahoo Finance
In summary, we expect the dollar to take a short time to recover their previous position before the picture in front of it, and that other currencies will generate confidence in the investors to take actions.