We saw a bit of wild price action for the yen this week, but it was mostly a round of positive risk sentiment this week as traders price in high hopes of more stimulus coming to help the global recovery.
Japanese Headlines and Economic data
There was no catalysts from Japan on the session, but we saw the biggest moves of the week during the U.S. session and following Asia session after U.S. President Donald Trump halts Covid-19 relief aid talks until after election. We saw an immediate risk aversion move in the financial markets, benefitting safe have assets like the Japanese yen.
The Japanese yen reversed its Tuesday gains quickly during the Asia trading session after U.S. President Donald Trump reversed on his call to end work on a stimulus package, calling for Congress to aid the U.S. airline industry.
Price action in the Japanese yen, and financial markets in general, from Wednesday through Friday was mostly dominated by developments and hopes of a new U.S. stimulus package. Traders seemed to have stayed positive that we’d see a deal soon, prompting positive risk sentiment and less of demand for safe haven assets like the Japanese yen.