The United States dollar slips down to a new 2-week low compared to the Yen this Monday. The worries about increasing trade tensions of United States with other top economies of the world hurt the risk appetite. Treasury Department of the United States is preparing the drafts to curb and block the firms that have a minimum of 25% Chinese rights from purchasing the United States companies with the “industrially considerable technology,” as stated by an official on Sunday.
Steven Mnuchin, United States Treasury secretary conveyed on this Monday that the forthcoming restrictions on investment from Treasury Department won’t be specifically applicable to China however, would also be applicable to all those countries, which are aiming to steal United States technology. This news managed to gain quite an attention after the United States President Donald Trump threatened to enforce a 20% tariff rates on the cars that are imported from European Union.
Increasing tensions regarding the trade pulled down the Global stock market. The director of Klarity FX, Amo Sahota at San Francisco stated that “The dollar-yen is continuing to have a little bit of safe-haven trading and still pressing down in the session as equities fail to recover.” The Japanese currency has a tendency to benefit at the time of financial or stress geopolitical tension since Japan is no doubt the largest creditor nation.
Also, it is being assumed that the Japanese investors would repatriate their funds if the crisis materializes. Amo Sahota also stated that the real danger lies in the scenario that the US dollar has lowered, down even, more these days. China’s Yuan finished the trading session on Monday at the lowest figure so far in 6 months after all the reserve requirements of a few banks were stricken off by the Central bank.