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Rise for the yen in forex markets after risk of tariffs surfaces

Japanese yen notes and coinsThe so-called “safe haven” Japanese yen surged in the foreign exchange markets on Tuesday after a fresh risk of tariffs surfaced.

The US announced that it was debating whether or not to add $11 billion worth of tariffs on to items coming in from Europe.

There were several items on the list produced by the US Trade Representative, including everything from alcoholic beverages to dairy items.

In addition, risk aversion was heightened by the fact that the International Monetary Fund (IMF) said it felt that a dip in the performance of the world’s economy might be on the cards.

The yen went up by 0.34% in the JPY/USD pair, rising to 111.125 per US dollar.

In its pair with the euro, it went up by just over a fifth of a percentage point.

The Australian dollar managed to keep its head above water and went up by 0.08% in its pair with the US dollar.

With the midweek point of the forex trading week now here, it’s time to look at what’s ahead on the economic calendar for the rest of the week.

Major events scheduled for today (Wednesday) include industrial production figures due out of the UK at 8.30am GMT. These are for the month of February and are expected to show a month on month change from 0.6% to 0.1%.

UK gross domestic product (GDP) data for the month of February will also be released, and it is forecast to show a month on month change from 0.5% to 0.0%.

Up this afternoon will be minutes from the meeting of the Federal Open Market Committee in the US, which are due at 6pm GMT.

The day will end with a release covering foreign investment in Japanese stocks for the dates around April 5th, which is due out at 11.50pm GMT.

On Thursday, Chinese consumer price index information for March is expected at 1.30am GMT. This is expected to show a year on year change from 1.5% to 2.3%.

There’ll be a harmonised index of consumer prices covering March out of Germany at 6am GMT. This is expected to show a change from 1.5% to 1.4%.

Initial jobless claims will be out of the US at 12.30pm GMT, covering the week of April 5th. These were last recorded at 202,000.

Continuing jobless claims for the week around March 29th are also expected. This metric is forecast to show a change from 1,717,000 to 1,733,000.

There’ll be two central banker speeches too. Richard H. Clarida, who is currently the Vice Chairman of the Board of Governors of the Federal Reserve, will speak at 1.30pm GMT.

Ten minutes later, there’ll be a speech from James Bullard, President of the Federal Reserve Bank of St. Louis.

The day will end with a release covering electronic card retail sales in New Zealand for the month of March. Month on month, this is expected to show a change from 0.9% to 0.7%.

Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.


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