Dollar slumps to new record low against yen at 75.95

LONDON — The dollar tumbled on Friday to a record low against the yen as investors flocked to the safe-haven Japanese currency amid deepening concern over another possible global recession, traders said.

By (AFP)

  • Follow us on
  • google-news
  • whatsapp
  • telegram

Published: Fri 19 Aug 2011, 9:26 PM

Last updated: Tue 7 Apr 2015, 3:47 AM

At about 1415 GMT, the dollar slumped to as low 75.95 yen, beating the Japanese unit’s previous post-World War II best against the dollar of 76.25.

The dollar later recovered slightly to around 76.26 yen.

“The movement in the yen is indicative that investors are continuing to take risk off the table,” said Nick Stamenkovic, foreign exchange analyst at RIA Capital Markets Ltd in London.

“A further appreciation in the currency could trigger another round of Bank of Japan intervention but this would only have a temporary impact. The yen’s strength looks set to persist near-term.”

In recent weeks, the dollar has fallen hard against the yen, which has long been regarded by investors as a safe-haven in times of worldwide economic turmoil. That cachet remains in place despite Japan’s problems, especially as it recovers from the devastating March earthquake.

Asian stock markets on Friday were hit again after new warnings of a world recession and as fears grew over the future of European banks with heavy exposure to sovereign debt.

European markets tumbled again on cue but then steadied in line with Wall Street, halting the dramatic slide as anxiety continued about a possible economic slowdown in the United States and Europe.

The yen has stayed strong as global investors have dumped US and European shares and looked for a secure place to park their capital.

Because a strong yen hurts Japanese exporters, the nation’s main economic engine, Japan stepped into the foreign exchange market earlier this month to dump yen for dollars, and Tokyo has signalled that it may do so again.

Official data earlier this week showed that Japan’s economy shrank less than expected in the April-June quarter, fuelling hopes that its recovery from the March 11 quake and tsunami disasters is on track.

Finance Minister Yoshihiko Noda also predicted that Asia’s second-biggest economy looks likely to grow again in the July-September quarter — but he also warned of the risk posed by the strong yen to exports and growth.

More news from