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Forex - Dollar drops to 4-day low against broadly stronger yen

Published 09/12/2011, 03:53 AM
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Investing.com – The U.S. dollar was down against the broadly stronger yen on Monday, falling to a four-day low as concerns that the debt crisis in the euro zone is deepening saw investors flock to safe haven assets.

USD/JPY hit 76.76 during late Asian trade, the pair’s lowest since September 6; the pair subsequently consolidated at 76.84, tumbling 0.95%.

The pair was likely to find support at 76.29, the low of August 11 and resistance at 77.58, the days high.

Concerns over a default by Greece escalated, following media reports that Germany’s government has plans to insulate their country’s banking sector from a default by the heavily indebted nation.

Meanwhile, last week’s resignation of European Central Bank governing council member Juergen Stark highlighted divisions among policymakers over the handling of the debt crisis.

Demand for the yen as a safe haven was also boosted after last week’s intervention by Switzerland’s central bank diminished the safe haven appeal of the franc.

The yen was also higher against the euro, with EUR/JPY dropping 1.55% to hit 104.27.

Later in the day, German Chancellor Angela Merkel was to hold talks on the debt crisis with European Commission President Jose Manuel Barroso.


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