Forex Asia Review – Yen maintains strength on safe haven demand

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Euro fell back down against the dollar  in the Asian session open after a volatile session on Friday gave it some bounce. The single currency was unable to hold on to those gains as focus shifts back to  concerns over the euro zone and sluggish global growth. EURUSD opened in Asia at 1.2418 and slid to 1.2384 moving closer to its lowest level since July 2010 hit on Friday.  London markets are closed this Monday,and the economic calendar is light, leaving many market participants on the sidelines.

 

Sterling mirrored moves in the EURUSD and edged down in early Asian trading. Trading volumes are light due to the UK spring bank holiday today and Queen’s Diamond jubilee holiday tomorrow. GBPUSD opened in Asia at 1.5358 and slid to 1.5340 before steadying in to a range.

 

Yen held on to gains made against the dollar on Friday after a disappointing U.S. jobs report pushed investors to the safe haven Japanese currency.  USDJPY opened in Asia at 78.07 where it hovered around those levels, not far off Friday’s trough of 77.65, the lowest since mid-February.  However, fears of a Bank of Japan intervention will probably prevent the yen’s sharp appreciation and USDJPY is expected to remain supported above the mid-77 yen level.  EURJPY opened at 96.93 and slid to  96.74 as euro fell across the board.

 

The Australian dollar slid during Asian trading to reverse gains made on Friday. The focus turns to the Reserve Bank of Australia meeting tomorrow and the risk of a rate cut is now much higher given disappointing May economic data outcomes. AUDUSD opened the session at 0.9698 and fell to 0.9626.