Yen fights back as risk appetite slackens

Published: 9 Dec at 5 AM Tags: Euro, Dollar,

The yen has staged a comeback following a further drop in the price of oil reducing the appetite for risk with investors. Both the euro and the dollar, which have been enjoying multi-year peaks, have slipped against their Japanese rival. The euro fell from 149.79 yen to 148.59. The greenback dropped from 121.86 to 120.67 yen.

The commodity currencies have also come under renewed pressure. The Australian dollar dropped to its lowest level since last November. The Aussie fell as low as 99.79 yen before recovering a tad to 100.08 yen.

Following Friday’s seven-year peak of 93.97 yen, the New Zealand dollar retreated to 92.35 yen. Oil prices shed around four per cent prompting an energy stock sell-off. Crude has not been this low in more than five years. The yen is likely to be given further support as Asian and US stocks track lower.

The dollar’s fall against the yen has also caused the euro to recover against the greenback. The single currency is worth $1.2300 after dipping to $1.2247, the lowest it has been in two years.

However, the euro could come under pressure if the European Central Bank pushes ahead with plans to introduce further policy easing in the New Year.