FOREX-Yen, Swiss franc jump in volatile trade as global recession fears grow
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Australian dollar sinks to five-year low
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Some market analysts worried about potential for liquidity event
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Investors betting on Fed cut in May
(Updates to
By
Asian stock markets and
The dollar was down 0.45% against the yen at 146.21 but had pared some losses after falling more than 1% against the Japanese currency earlier in the session.
"The big theme has been selling USD/JPY because it's a good
U.S. recession proxy and it's a good U.S. yields proxy and U.S.
yields tanked," said
The Swiss franc jumped more than 0.6% to 0.8548 per dollar, extending its 2.3% surge against the greenback last week.
Both currencies have emerged as significant winners in the aftermath of Trump's latest tariff salvo but others have not.
The Aussie tumbled to a five-year low early in the
session, before paring some of those losses to last trade 0.66%
lower at
The
"Things have gone from bad to worse this morning," said
"If there isn't some sort of walking back of the announcements, then we're heading for a liquidity event and liquidity will get sucked out of these markets big time across all asset classes."
Trump's tariff announcements wiped out nearly
More than 50 nations have reached out to the
Assets like government bonds and gold have also risen on safety bids.
While the dollar is also typically known to be a safe haven asset, that status seems to be eroding as uncertainty over tariffs and concern over their impact on U.S. growth intensify.
Against a basket of currencies, the dollar was little changed at 102.81, having tumbled 1% last week.
"Given the U.S. is at the epicentre of the trade war, the USD has been suffering from outflows" with investors "looking ... to diversify away from U.S. assets," said Rodrigo Catril, senior FX strategist at National Australia Bank.
The euro was up 0.03% at
Traders have ramped up bets of more Federal Reserve rate cuts this year on the view policymakers would have to ease more aggressively to shore up growth in the world's largest economy.
Markets swung to imply an around 55% chance of a Fed cut in May, and futures now point to more than 100 basis points worth of rate cuts by December this year. Investors were previously expecting the Fed to keep rates on hold next month.
Fed Chair
Onshore yuan fell to an over two-month low on
Monday at 7.3145 per dollar, after
Its offshore counterpart eased more than 0.3% to 7.3193 per dollar.
(Reporting by
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