Yen shines as AI jitters spur safe-haven rush
SHANGHAI/SINGAPORE: The Japanese yen hit its strongest level in more than a month on Friday , buoyed by safe-haven flows due to a fresh bout of risk aversion that also sent US Treasury yields sharply lower, pushing the dollar to a nearly three-week trough. The moves in the currency markets were driven by doubts over the AI spending boom even as Brent crude futures stay above $110 per barrel ,…
The Japanese yen reached its strongest level in over a month on Friday, driven by safe-haven flows stemming from renewed risk aversion. The surge in the currency market was fueled by doubts surrounding the artificial intelligence (AI) spending boom, as US Treasury yields experienced a sharp decline, pushing the dollar to a nearly three-week low.
Despite Brent crude futures staying above $110 per barrel, indicating concerns over economic growth, the yen strengthened by 0.3% to 156.28 per dollar, marking its best weekly gain in over a year. The dollar index, measuring the greenback against a basket of currencies, settled at 101.52, reaching its lowest point since early October.
US 10-year Treasury yields hovered near a one-month low at 4.953%, after plummeting on Thursday amid renewed concerns about the sustainability of the AI boom. Analysts from ING cautioned that while yields may stay below 5%, they anticipate a rebound above 5% eventually due to inflation, fiscal deficits, and AI trends. The risk-off environment is alleviating the Federal Reserve's pressure to hike interest rates next week, though the analysts do not foresee substantial duration buying at present.
Meanwhile, the dip in the dollar provides a brief respite as the focus shifts to the Federal Reserve.
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- Yen shines as AI jitters spur safe-haven rush investing.com
