Yen jumps as oil, AI and France worries rattle markets
Read a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST
Tap here to return to FAST
FAST
NEW YORK, Oct 22 : The yen was on track for its strongest daily gain in almost a month on Thursday, as investors sought safety amid fragile equity markets, elevated crude prices from the drawn-out war in the Middle East, and doubts over future returns from artificial intelligence.
The US dollar, meanwhile, rose against the euro. Worries about social unrest in France and a worsening fiscal outlook for the country outweighed concerns about the AI trade, which pushed US stocks lower.
“AI is making people nervous, as is oil … and as is France, and obviously we have a slight degree of risk aversion in the market,” said Chris Scicluna, head of economic research at Daiwa Capital Markets.
Brent crude climbed to its highest level since May after further Houthi attacks in Saudi Arabia raised fears of an escalation in the Middle East conflict and more disruption to oil supplies from the key exporting region.
Guess Word
Crack the word, one row at a time
Buzzword
Create words using the given letters
Mini Sudoku
Tiny puzzle, mighty brain teaser
Mini Crossword
Small grid, big challenge
Word Search
Spot as many words as you can
The Japanese yen strengthened 0.51 per cent to 157.33 per dollar.
The Swiss franc, another traditional safe haven, was little changed at 0.824 per dollar.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.14 per cent to 101.82, with the euro down 0.3 per cent at $1.1198.
The dollar has become increasingly tied to capital flows and to growth and inflation expectations linked to the AI trade. It fell last week as fears over the AI outlook grew. On Thursday, however, concerns about France outweighed those fears.
“You have these competing stories and weak points between US AI-related credits and then France sovereign credit, and we’ve seen this push and pull in the last couple of days where at times one is more of a concern than the other,” said Erik Nelson, global head of FX strategy at Wells Fargo. “As long as France is more of a concern than US AI credits, then you’re going to see the euro underperform.”
French President Emmanuel Macron vowed on Wednesday to prevent a repeat of last weekend’s violence at protests planned in the coming days, and dismissed as “stupid” and “unacceptable” comments from some foreign leaders about the unrest.
Concerns about France’s ability to manage its huge debt burden have hurt French government bonds and raised worries about other heavily indebted euro zone countries. The spread between France and Germany’s 10-year note yields reached 177.7 basis points on Thursday, the widest gap since 2011.
Sterling weakened 0.18 per cent to $1.337. The Australian dollar fell 0.21 per cent to $0.7012.
In cryptocurrencies, bitcoin fell 3.20 per cent to $81,929.
(Additional reporting by Amanda Cooper and Tom Westbrook; Editing by Xevi Fontdegloria)
Source: Reuters
Sign up for our newsletters
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST
Tap here to return to FAST
FAST
