Japanese Yen Weakens as Safe Haven Appeal Diminishes

An improvement in market sentiment over positive developments in the US-China trade war is causing the Japanese yen to weaken against the US dollar on Wednesday. At the time of writing. USD/JPY is trading at around 107.82.

The safe haven appeal for the Japanese yen has been diminished over news reports that China is considering increasing imports of US agricultural products as a goodwill gesture before the next round of trade talks scheduled for October. Earlier today, China’s Ministry of Finance also announced an exemption of tariff hikes on 16 different products imported from the US.

The US dollar has been trading relatively steady as traders are hesitant to make significant movements before the important ECB meeting due tomorrow. There is a high likelihood of the central bank announcing a rate cut and rolling out additional stimulus measures to stop the Eurozone economy from weakening further.