Yen ticks up in Asia on global economy jitters

TOKYO- The yen edged higher in Asia on Friday, wiping out early losses, as ongoing worries about the global economy offset a positive batch of data out of the United States.

In Tokyo afternoon trading, the dollar slipped to 106.17 yen from 106.33 yen in New York while the euro eased to 135.88 yen from 136.19 yen.

The single currency also eased to $1.2798 from $1.2809.

After equity markets were hammered this week by growing fears over the global economy, the US Department of Labor offered a ray of hope on Thursday as it reported that jobless claims for the week ending October 11 fell to their lowest level since 2000.

Also, the Federal Reserve said industrial production rebounded in September from an unexpected drop in August.

The two reports came after disappointing data earlier in the week, including a poor September retail sales report

But they were not enough to settle investors after weeks of market upheaval fed by worries about the global economy as the eurozone, China and Japan struggle to reignite growth.

Investors tend to flock to the yen during times of uncertainty and turmoil because it’s perceived as a safe asset.

“The yen has been in demand of late, mainly on the back of rising global risk aversion,” Credit Agricole said.

The dollar has fallen in value against the yen and the euro since the Fed earlier this month indicated it will likely refrain from hiking interest rates soon owing to worries about overseas economies.

“Any delay in expected monetary normalisation by the Fed will indeed hurt the dollar,” said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange.

“However, the dollar is likely to remain underpinned by the view that America’s economy remains the ‘cleanest shirt in the hamper’.”

The euro slipped on renewed concerns about Greece after the government hinted that it might exit a four-year-old bailout early as it looks to free itself of strict controls attached to it.

Analysts have said investors fear Athens will not be able to stand on its own two feet if it goes ahead with the plan, with the country’s main stock market plunging and borrowing costs rising.