The yen was on track for its first weakening in six sessions, providing limited relief for Japanese exporters as major stock markets around Asia struggled to finish the week on an up note.
But it has proven to be a blustery five days for investors, who have watched the yen soar through the ¥100 per dollar mark for the first time since the UK’s vote to leave the EU and as the market continues to debate the global outlook for monetary policy.
The dollar has been under pressure for most of this week as investors pegged back expectations the Federal Reserve would raise interest rates at its September meeting, even as the minutes from its July meeting, released on Wednesday, showed committee members were split on the need for a rise.
The dollar index, a measure of the US currency against a basket of global peers, was up 0.2 per cent on Friday at 94.332, heading for its first gain in six sessions, but still facing a decline of 1.5 per cent for the week.
Similarly, the yen was down 0.4 per cent at ¥100.24 per dollar today, heading for its first fall in six sessions. This week, the yen traded as high as ¥99.54 per dollar, the strongest level since June 24 and the aftermath of the UK’s Brexit vote. Japanese government officials said they are “closely watching” movements in the foreign exchange market.
Gold, which is sensitive to interest rate expectations, was down 0.4 per cent at $1,347.21 an ounce, after a four-day winning streak, and was still heading for a gain of 0.9 per cent this week.
Japanese stocks were flailing in Friday trade, with the broad Topix down 0.1 per cent and the Nikkei 225 also off as much. Australia’s S&P/ASX 200 was up 0.1 per cent, with the energy sector holding up as the price of oil rose about $50 overnight for the first time since June.
Hong Kong’s Hang Seng was down 0.5 per cent, while on the mainland the Shanghai Composite was down 0.2 per cent and the tech-focused Shenzhen Composite was flat.
The European Central Bank, in the minutes from its most recent meeting, hinted at taking further action next month to support the eurozone economy if conditions fail to improve. Nonetheless, the euro had also risen for five sessions in a row to Thursday owing to a weaker dollar, but was down 0.2 per cent in Asia today at $1.1334.
Oil prices were mixed on Friday after some excitement in the previous session as Brent crude traded above $50 a barrel for the first time since June. Prices have pushed higher this week amid persistent hopes an informal Opec meeting next month will yield a production cap, but data yesterday showed Saudi Arabia increased exports in July. Brent, the international benchmark, was down 0.1 per cent at $50.82 a barrel, while West Texas Intermediate, was up 0.1 per cent at $48.27.
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