The Japanese yen was one of the big winners on the global stage yesterday, mustering support from various areas. Firstly, Japanese growth figures where published early on Thursday morning, coming in 0.5% better than forecast at 1.5% quarter-on-quarter, and at 5.9% versus a forecasted 4.2% year-on-year. Given a disappointing growth figure from the European Union, there seemed to be an evident ‘risk off’ effect in the market. As previously witnessed, there were safe haven flows into yen, supporting the Japanese currency. We saw the yen climb to its strongest levels against the dollar since mid-March and even further back until end of February against the common currency. On the other hand, the Mexican peso was one of the biggest losers among the major currencies. After almost reaching a five-month high against the dollar yesterday it retraced over 0.5% yesterday as the US released disappointing data on industrial output.
Today there are only some minor data releases, including Chinese foreign direct investment data, Hong Kong growth data and Canadian foreign securities purchases. Thus most of the movement expected tomorrow will be relative against the major currencies or spurred on by non-financial factors.
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