Yen set for biggest rally in a month as risk-averse investors shun dollar
SPY•The dollar fell 0.6% to 157.27 yen, its biggest drop since late September, as risk-averse investors bought the yen. The Bank of Japan is expected to hold rates at 1.25% next week.
1. Yen strengthens
The yen headed for its strongest daily rally in a month as investors sought safer assets amid concerns about equity markets, high crude prices and potential disappointment in future AI returns. The dollar fell 0.6% to 157.27 yen, its largest drop since late September, while the yen also gained against the euro, pound and Australian dollar.
2. Central bank outlook
The Bank of Japan is expected to leave rates unchanged at 1.25% next week. Markets expect a series of increases that would bring borrowing rates to around 2% by the end of 2027. The euro held at $1.1234 as concern about France’s debt burden weighed on the single currency.
