Euro descends, as yen moved in early Asia trade
With investors fleeing leveraged carry trades in the middle of increasing risk aversion and weakening share bazaar, Yen rushed in an early Asian trading hitting a 13 months high on the descending European currency. The hostile move that came during illiquid period between Tokyo’s opening and New York’s closing, left traders confused.
Director of currency research at GFT Forex in New York, Kathy Lien, called the situation as risk aversion and strict amount of post New York capitulation.
With euro collapsing to 151.12 yen
Analysts and experts said that, according to the situation, it looked like investors have been bailing out of leveraged carry trades, which is positions funded by taking yen at smaller and low rates to buying better yielding commodities and currencies. Causing yen to take 13 month high leap on Australian dollar
On Thursday, increasing concerns regarding global economic growth hitting equities and pushing risk aversion higher, knocked Dow Jones industrial average .DJI down to 3 percent.
The biggest causality came in form of euro that fell from $1.4226