The dollar and yen strengthened against most of their major counterparts as violence in Libya boosted demand for the two currencies as a refuge.
The Swiss franc climbed to a three-week high versus the euro after the Libyan government attacked protesters and rebels claimed control of the second-biggest city, Benghazi. New Zealand’s dollar slumped to the lowest this year against the greenback after an earthquake struck the city of Christchurch. South Korea’s won weakened on concern rising fuel prices will derail the economic recovery.
“Given the tensions that are still prevalent in the Middle East and North Africa, we probably should still see some risk- aversion trades,” said Matthew Brady, executive director for foreign exchange at JPMorgan Chase & Co. in Sydney. “The dollar and the Swiss franc should benefit and the euro should be sold.”
The dollar rose to $1.3585 per euro as of 7:02 a.m. in London from $1.3678 yesterday in New York, the biggest one-day gain since Feb. 10. The yen climbed to 113.01 per euro from 113.73, the largest advance since Feb. 3. Japan’s currency traded at 83.26 per dollar from 83.14. The franc gained to 1.2877 per euro from 1.2951, after appreciating to 1.2862, the highest level since Jan. 31.
The MSCI Asia Pacific Index of shares slid 1.9 percent.
‘Rivers of Blood’
The dollar strengthened versus all 16 of its major counterparts after Libya erupted into violence yesterday when Muammar Qaddafi’s son threatened “rivers of blood” and deployed security forces on protesters. U.S. Secretary of State Hillary Clinton said “the world is watching the situation in Libya with alarm.”
Libya, holder of Africa’s largest oil reserves, has been rocked by protests ignited by last month’s ousting of Tunisia’s president and fanned by the Feb. 11 fall of Egyptian President Hosni Mubarak.
United Nations Secretary-General Ban Ki-moon was “outraged at press reports that the Libyan authorities have been firing at demonstrators from warplanes and helicopters,” according to a statement released yesterday by his spokesman.
Japan’s currency pared gains after Moody’s Investors Service changed its outlook on the government’s credit rating to negative from stable.
“The yen was sold briefly” after the Moody’s announcement,” said Hitoshi Asaoka, a senior strategist in Tokyo at Mizuho Trust & Banking Co., a unit of Japan’s second- largest bank. “But the news wasn’t surprising after Standard & Poor’s took similar action, limiting the impact.”
S&P cut Japan’s credit rating for the first time in nine years last month, citing the lack of a “coherent strategy” to address the nation’s debt burden.
Kiwi Slides
New Zealand’s dollar slid versus all the major currencies after the 6.3 earthquake caused multiple deaths and toppled buildings in Christchurch, the nation’s second-largest city.
The quake brought down parts of buildings and New Zealand police said multiple fatalities have been reported.
“The risk is that we see the market price out tightening from the Reserve Bank in October, and that probably drags the New Zealand down,” said Jonathan Cavenagh, a currency strategist in Singapore at Westpac Banking Corp, Australia’s second-largest lender. “The earthquake has caught the market in a risk-averse mood anyway with the yen strengthening and oil prices rising on tensions in the Middle East.”
New Zealand’s dollar declined 1.9 percent to 74.95 U.S. cents, after falling to 74.89 cents, the weakest since Dec. 27. The so-called kiwi fell 1.7 percent to 62.45 yen.
Won Drops
South Korea’s won fell for a second day as oil climbed to the highest level in two years as violence escalated in Libya.
The Korean government set up a 24-hour team to monitor the unrest in the Middle East after three nationals were injured by rioters in Libya, the Ministry of Land, Transport and Maritime Affairs said in a statement yesterday.
“The political situation in the Middle East is one of the reasons driving the won lower as it could affect the global economic recovery,” said Sam Hong, a currency dealer at Shinhan Bank in Seoul. “The Korean economy is influenced by the global markets.” The won declined 0.9 percent to 1,127.60 per dollar, after sliding to 1,128.55, the weakest since Feb. 11.
The Swiss franc climbed to a three-week high versus the euro after the Libyan government attacked protesters and rebels claimed control of the second-biggest city, Benghazi. New Zealand’s dollar slumped to the lowest this year against the greenback after an earthquake struck the city of Christchurch. South Korea’s won weakened on concern rising fuel prices will derail the economic recovery.
“Given the tensions that are still prevalent in the Middle East and North Africa, we probably should still see some risk- aversion trades,” said Matthew Brady, executive director for foreign exchange at JPMorgan Chase & Co. in Sydney. “The dollar and the Swiss franc should benefit and the euro should be sold.”
The dollar rose to $1.3585 per euro as of 7:02 a.m. in London from $1.3678 yesterday in New York, the biggest one-day gain since Feb. 10. The yen climbed to 113.01 per euro from 113.73, the largest advance since Feb. 3. Japan’s currency traded at 83.26 per dollar from 83.14. The franc gained to 1.2877 per euro from 1.2951, after appreciating to 1.2862, the highest level since Jan. 31.
The MSCI Asia Pacific Index of shares slid 1.9 percent.
‘Rivers of Blood’
The dollar strengthened versus all 16 of its major counterparts after Libya erupted into violence yesterday when Muammar Qaddafi’s son threatened “rivers of blood” and deployed security forces on protesters. U.S. Secretary of State Hillary Clinton said “the world is watching the situation in Libya with alarm.”
Libya, holder of Africa’s largest oil reserves, has been rocked by protests ignited by last month’s ousting of Tunisia’s president and fanned by the Feb. 11 fall of Egyptian President Hosni Mubarak.
United Nations Secretary-General Ban Ki-moon was “outraged at press reports that the Libyan authorities have been firing at demonstrators from warplanes and helicopters,” according to a statement released yesterday by his spokesman.
Japan’s currency pared gains after Moody’s Investors Service changed its outlook on the government’s credit rating to negative from stable.
“The yen was sold briefly” after the Moody’s announcement,” said Hitoshi Asaoka, a senior strategist in Tokyo at Mizuho Trust & Banking Co., a unit of Japan’s second- largest bank. “But the news wasn’t surprising after Standard & Poor’s took similar action, limiting the impact.”
S&P cut Japan’s credit rating for the first time in nine years last month, citing the lack of a “coherent strategy” to address the nation’s debt burden.
Kiwi Slides
New Zealand’s dollar slid versus all the major currencies after the 6.3 earthquake caused multiple deaths and toppled buildings in Christchurch, the nation’s second-largest city.
The quake brought down parts of buildings and New Zealand police said multiple fatalities have been reported.
“The risk is that we see the market price out tightening from the Reserve Bank in October, and that probably drags the New Zealand down,” said Jonathan Cavenagh, a currency strategist in Singapore at Westpac Banking Corp, Australia’s second-largest lender. “The earthquake has caught the market in a risk-averse mood anyway with the yen strengthening and oil prices rising on tensions in the Middle East.”
New Zealand’s dollar declined 1.9 percent to 74.95 U.S. cents, after falling to 74.89 cents, the weakest since Dec. 27. The so-called kiwi fell 1.7 percent to 62.45 yen.
Won Drops
South Korea’s won fell for a second day as oil climbed to the highest level in two years as violence escalated in Libya.
The Korean government set up a 24-hour team to monitor the unrest in the Middle East after three nationals were injured by rioters in Libya, the Ministry of Land, Transport and Maritime Affairs said in a statement yesterday.
“The political situation in the Middle East is one of the reasons driving the won lower as it could affect the global economic recovery,” said Sam Hong, a currency dealer at Shinhan Bank in Seoul. “The Korean economy is influenced by the global markets.” The won declined 0.9 percent to 1,127.60 per dollar, after sliding to 1,128.55, the weakest since Feb. 11.
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