The yen surged to its highest level since January and stocks tumbled, with investors betting the Bank of Japan will keep raising interest rates after last Wednesday’s hike.
USD/JPY dropped as much as 1.2% to 144.77, while Japan’s benchmark 10-year bond yield fell to its lowest since April, slipping as much as 17 basis points
Leveraged funds were giving up positions shorting the yen versus Aussie and Mexico’s peso, as the volatility component of the carry trade starts to outstrip return, according to an Asia-based FX trader
Japan’s Topix index fell more than 7% on Monday
The yen edged higher as traders continued to unwind emerging-market carry trades. The Bloomberg Dollar Spot Index was little changed after falling 0.7% on Friday
EUR/USD rose 0.1% to 1.0920
GBP/USD dropped 0.1% to 1.2794
AUD/USD fell 0.1% to 0.6502
Source : Bloomberg
