CANBERA (dpa-AFX) - The safe-haven currencies such as the U.S. dollar and the Japanese yen strengthened against their major currencies in the Asian session on Monday amid risk aversion among traders, as stronger than expected U.S. employment data weighed heavily on the outlook for interest rates. It raised concerns that the U.S. Fed will likely hold interest rates at current levels or slow down the pace of reductions. Rising bond yields also hurt the safe havens.
The combination of rate fears and geopolitical tensions reduces investors' desire for riskier assets.
Additionally, the Bank of Japan's rate hike uncertainty also led to the rise of safe-haven JPY.
In the Asian trading today, the U.S. dollar rose to more than a 2-year high of 1.0208 against the euro and more than a 1-year high of 1.2126 against the pound, from Friday's closing quotes of 1.0244 and 1.2204, respectively. If the greenback extends its uptrend, it is likely to find resistance around 1.00 against the euro and 1.20 against the pound.
Against the Swiss franc and the NZ dollar, the greenback edged up to 0.9180 and 0.5548 from last week's closing quotes of 0.9164 and 0.5556, respectively. On the upside, 0.93 against the franc and 0.54 against the kiwi are seen as the next resistance level for the greenback.
Against the Australia and the Canadian dollars, the greenback advanced to nearly a 5-year high of 0.6131 and a 1-week high of 1.4447 from Friday's closing quotes of 0.6145 and 1.4422, respectively. The next possible upside targets for the greenback are seen around 0.60 against the aussie and 1.46 against the loonie.
The yen rose to nearly a near 4-week highs of 160.67 against the euro and 171.47 against the Swiss franc, from Friday's closing quotes of 161.54 and 172.06, respectively. If the yen extends its uptrend, it is likely to find resistance around 158.00 against the euro and 169.00 against the franc.
The yen edged up to 157.25 against the U.S. dollar, from Friday's closing value of 157.69. On the upside, 154.00 is seen as the next resistance level for the yen.
Against the pound, the yen advanced to a 5-week high of 190.85 from last week's closing value of 192.44. The next possible upside target is seen around 189.00 area.
Against the Australia and the New Zealand dollars, the yen climbed to near 4-week highs of 96.49 and 87.32 from last week's closing quotes of 96.90 and 87.61, respectively. The yen may test resistance around 94.00 against the aussie and 85.00 against the kiwi.
The yen rose to a 1-week high of 108.94 against the Canadian dollar, from Friday's closing value of 109.33. On the upside, 106.00 is seen as the next resistance level for the yen.
Looking ahead, U.S. NY Fed 1-Year consumer inflation expectations for December is due to be released in the New York session.
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