7/24/2019, 10:17 AM (Source: TeleTrader)
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Euro falls to January lows versus yen

Downward pressures on the joint currency of 19 European nations increased on Wednesday with disappointing results of manufacturing surveys. The sector accelerated the reduction of activity and output, underpinning fears of a recession. The euro plunged to ¥120.2025, the weakest level since January 3, and to $1.1127, last seen at the end of May. The European Central Bank is due to issue an update tomorrow after hinting it is ready to cut borrowing costs and renew asset purchases to mitigate the impact of Brexit uncertainty and protectionist measures in the disputes between the United States and its trading partners. Investors are expecting either a rate cut or much clearer guidance.

The Bank of Japan and the Federal Reserve are meeting next week and their shift toward easing will be crucial for traders. In other news, Deutsche Bank posted the worst loss since the financial crisis. The risk that the United Kingdom would crash out of the European Union strengthened as Boris Johnson is slated to become prime minister and the depreciation relative to the yen, a conventional safe haven, may reflect the developments.

The euro was 0.3% down at ¥120.318 and 0.12% in the red at $1.11371. The exchange rate against the pound fell 0.26% to £0.89411 after touching £0.89388 for the first time in three weeks. The euro lost 0.19% to 7.6631 offshore yuan following a dip to 7.66057, last seen on May 10, and traded flat at 1.09856 Swiss francs.

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