Japanese Yen edges down against US Dollar due to Iran tensions but outperforms other
The Japanese Yen (JPY) is marginally lower against the US Dollar (USD), but outperforms its other peers during the late Asian trading session on Thursday. The USD/JPY is slightly higher to near 159.55, close to its four-week high of 159.65 posted earlier in the day.
The pair trades higher as the US Dollar outperforms its peers due to renewed tensions in the Middle East, following the exchange of attacks between the United States (US) and Iran.
As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.3% higher to near 99.50.
Earlier in the day, Iran’s Islamic Revolutionary Guard Corps (IRGC) said that it attacked US military bases as retaliation against Washington’s attacks near Bandar Abbas airport. The IRGC has also threatened 'a more decisive' response if the US attacks again.
Renewed Middle East conflicts have promoted oil prices, a scenario that is unfavorable for currencies from economies, such as Japan, which rely heavily on oil imports to meet their energy needs.
Meanwhile, the Asia-Pacific currency trades higher against its other peers as Bank of Japan (BoJ) Governor Kazuo Ueda has warned of second-round effects due to “high inflation expectations and rising wages” in the wake of the oil price shock, in a speech on Wednesday. However, Ueda didn’t comment on when the BoJ will hike interest rates this year.
Going forward, investors will focus on the US Personal Consumption Expenditure Price Index (PCE) data for April, which will be published at 12:30 GMT.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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