The US dollar fell to a one-day low against the Japanese yen, amid a surge in the US-China trade tension, affecting market sentiment and boosting safe haven demand for the Japanese currency. The USD / JPY fell 0.23% to hit 110.40 yen per dollar, falling from last Friday’s high of 110.90 yen.
Market sentiment deteriorated after China’s reprisals against trade tariffs imposed by the Trump administration sparked fears of a possible trade war between the world’s two largest economies. Investors often look for the Japanese yen as a safe haven in times of geopolitical tensions and market turmoil.
In EUR / USD trading, the value of the euro did not change much against the dollar, with the pair trading at $1.1603 per euro. The single currency remained unchanged after the Fed pointed faster pace of monetary tightening this year. The euro fell 1.34% against the US dollar last week, after the European Central Bank set plans to keep interest rates at least until the middle of next year.
The NZD / USD pair closed last week’s trading session down 100 pips, and the week started with quiet moves as investors continued to assess the potential impact of the escalating trade conflicts between the US and China. Since the beginning of Monday, the pair has moved in a narrow range and traded at 0.6940, dropping 0.12% during today’s trading. New Zealand’s consumer survey results for the second quarter of the year will be released on Tuesday.
Meanwhile, the pound was lower against the dollar in today’s trading session, with GBP / USD shedding 0.29% to trade at $1.3238 per pound. Earlier in the day, Britain’s chambers of commerce cut their growth forecasts for the UK, as uncertainty over Britain’s exit from the EU and fears of a global trade war has caused further mistrust.
US data showed that the NAHB housing market index fell to 68 in June, from 70 in the previous reading. The basic details of the report revealed that the high cost of timber was weighing on homeowners.
The dollar index, which measures the strength of the greenback versus a basket of major currencies, reached 94.52 points, keeping below the eleven month high of 95.13, reached on Friday.