Dollar trades below 12-week high vs. yen as North Korea fears weigh

© Reuters. FILE PHOTO: Illustration photo of the US Dollar-and Yen-notes

By Masayuki Kitano

SINGAPORE (Reuters) — The dollar held steady against the yen on Monday, after a departure from the 12-week highs set last week due to renewed focus on geopolitical risks in the midst of concerns to test that North Korea may be preparing a further missile.

North Korea is preparing to test a long-range rocket, which believes it will reach the West coast of the United States, a Russian legislator who was cited after returning from a visit to Pyongyang by Russia’s RIA news agency said on Friday.

Helped renewed focus on geopolitical tensions, supporting the safe-haven yen, and helped pull the dollar down from its post-US-jobs-data highs.

On Friday, the dollar was already taking on the retreat due to profit, if the North Korea-related impact achieved lines, the market, the tightening of the greenback to fall, said Stephen Innes, head of the trade in the Asia-Pacific region for Oanda in Singapore.

«Asia is really going to sit back and just see how this goes, to play, to keep watch on the title,» said Innes. «This market is very, very nervous.»

The last dollar traded at 112.56 yen, steady on the day. On Friday, the dollar had reached a peak of 113.44 yen, the highest since July 14.

Trading was thinner than normal, with Tokyo markets closed on Monday for a public holiday.

Since Japan is the world’s largest net creditor nation is to assume the dealer of Japanese repatriation from abroad. eclipse foreign investors, the sale of the Japanese assets during times of increased economic uncertainty This means that the yen has the same behaviour continued, as a safe-haven currency, despite Japan’s geographical proximity to North Korea.

The dollar index, which eased the measures the greenback against a basket of six major currencies, 0.1 percent to 93.709. On Friday, it had 94.267 scaled up, its strongest in more than two months.

The wage was seen, data from the U.S. September employment report, as a sign of potential inflation, improve, and gave the dollar a boost, as expectations for the Federal Reserve interest rates in December strengthened.

The Turkish lira fell, amid fresh signs of fraying diplomatic relations between Turkey and the United States.

The lira took a hit following news that the U.S. mission in Turkey, and later of the Turkish mission in Washington threats to each other back visa services, according to a U.S. Consulate employee, was arrested in Turkey.

The U.S. dollar rose 3.2 percent against the Turkish lira to 3.7325. The lira, on course for its worst daily performance since July of 2016.

The lira, which, however, still above the current year’s low is close to 3.9415, said Mingze Wu, FX traders of global payments for financial services provider INTL FCStone Ltd. in Singapore.

«This latest political development, but, surprisingly, is still far from drastic… We need to see more escalation from this point to a further weakening of the lira,» he added.

The new Zealand dollar touched a four-month low, after a final election result in the country, close the Bundestag, published in choice, over the weekend a clear winner was able to recognize.

The new Zealand dollar slipped as low as $0.7052, the lowest level since may 30. The kiwi was last trading at $0.7075, by 0.2 percent on the day.

«There are still a lot of political uncertainty around the make-up of the next government. The political risk premium is faith in the kiwi and I, you keep it under pressure in the short-term,» said Peter Dragicevich, a G10 FX strategist at Nomura in Singapore.

The euro rose 0.1 percent to $1.1745, after you pulled up from the Friday low of $1.1669, the lowest level since Aug. 17.

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