The Swiss franc gained across the board on Wednesday and the yen rallied to a two-week high versus the dollar. Investors moved together to perceived safe havens assets amid growing fears about the trade saga and growth.
The Swiss franc, a currency among the Safe heaven assets that usually gains when risk aversion is strong, gained against the euro. It kept within striking distance of a near two-month high hit last week.
The yen edged 0.2 percent higher to 109.15 against the dollar, its highest level since May 15 this year. However, it was not far away from an early February high of 109.02 yen.
The dollar – bolstered by its status as the world’s reserve currency – held its ground against the euro, the pound and other currencies. It was less than half a percent below a two-year high of 98.37 hit last week against a basket of its rivals. It was broadly steady at 97.97.
The U.S. Treasury Department said in a report on Tuesday it reviewed the policies of an expanded set of 21 major U.S. trading partners. It found that nine required close attention due to currency practices: China, Germany, Ireland, Italy, Japan, South Korea, Malaysia, Singapore, and Vietnam.
START TRADINGForex – Safe heaven assets gain amid trade saga
Sterling held near four-month lows on Wednesday. However, with the contest to succeed Prime Minister Theresa May under way and the clock ticking on Brexit, investors are preparing for greater currency swings in coming months.
A gauge of the difference between expected swings in sterling over the next three and the next six months rose to its highest level in more than three years. The currency has lost more than 3% so far in May, its worst month in a year.
Against the euro, the pound was trading at 88.30 pence, not far from a four-month low of 88.50 pence hit last week. It slipped 0.2% against the dollar to around $1.2632, just off four-month lows.
Oil prices fell sharply on Wednesday as China signaled it would play the rare earths card in its trade saga with the United States. Front-month Brent crude futures, the international benchmark for oil prices, were at $68.68 a barrel at 1345 GMT, down $1.43 from the previous close, having hit a session low of $68.08.
U.S. West Texas Intermediate (WTI) crude futures were at $57.57 per barrel, down $1.57, after hitting a low of $57.14.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money