The Japanese yen was able to increase its value last week as investors sought refuge to a safe haven in the wake following the weak crude oil prices in the U.S. dollar which was pulled lower after a rather disappointing economic data.
The surmounting fears of deflation in the Eurozone, remain to be the principal downer in the euro which kept it close to a nine-year low against the dollar while pressure rises on the European Central Bank to ease tension in the existing monetary policy.
New orders for the American factory goods plunged for a fourth straight month in November while at the same time an assessment of growth in the U.S. services fell short of the expected figures in December, hitting a 6-month low as revealed by data last week.
The last set of data points were rather weak in the U.S. which tugged the dollar yet the strong dollar trend remains fastened well in place. In the structure of things, the euro remains surprisingly weak according to the head of G10 FX strategy at Nomura Securities International in New York.
Falling U.S. Treasury yields were prevalently undermining the greenback against the yen. The dollar is at a two-week low against the Japanese currency which hit 118.62 before recovering slightly to 119 yen at 0.53 % loss on the day.
The Euro fell to 141.38 yen which was a two-month low prior to stabilising at around 141.65 yen, a loss of 0.75 %. Moreover, the euro was traded down 0.17 % at $1.19100, having earlier reached a record low of $1.18850 on the EBS trading platform which was not far from the $1.1860 area hit last week, a level not seen since March 2006.
Unvarying chatter of a Greek exit from the eurozone further drained confidence in the said currency with the crude oil prices falling to a fresh 5-1/2 year lows over global supply excess concerns.
The global risk sentiment has been greatly affected by sliding stocks and oil prices which is the leading perception that there indeed is a lack of demand and that has marked implications for global growth.
However, it would still be a bit cautious in extrapolating so much at an early part in the year. This plunge in risk appetite is more likely just a temporary one and there should be a recovery of the dollar against the yen and it is expected that the euro will be heading lower.
The Canadian dollar was also repressed at $1.1771 CAD per U.S. dollar which was not far from a five and a half year low of $1.1818 CAD last week.