Japanese Yen Gains on Safe-Haven Bid

2026-01-19 02:18 By Jam Kaimo Samonte 1 min. read

The Japanese yen appreciated past 158 per dollar on Monday, reaching a one-week high as renewed geopolitical and trade concerns boosted demand for safe-haven assets.

US President Donald Trump threatened new tariffs on eight European countries in a bid to gain control of Greenland, drawing criticism from European leaders.

Domestically, investors focused on the Bank of Japan’s policy decision this week, with rates widely expected to remain unchanged and markets eyeing a possible move in June.

Investors are also assessing fiscal and political implications after Japanese Prime Minister Sanae Takaichi said she will dissolve parliament on Friday and call a snap election for February 8, seeking support for increased spending and a new security strategy.

She pledged a two-year halt to the 8% consumption tax on food and said her plans would create jobs, boost household spending, and raise other tax revenues.



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Yen Extends Fall on Surging Oil Prices
The Japanese yen depreciated to around 159 per dollar on Thursday, sliding toward its weakest level in a year and a half as oil prices continued their ascent, pressuring the country’s oil-importing economy. Oil rallied for a second day as the prospect of a protracted Iran war overshadowed a coordinated release of oil reserves by major economies, with the IEA approving its largest-ever release of 400 million barrels. That includes 172 million barrels from the US, while Japan will release 80 million barrels from its reserves. Japan remains highly exposed to oil supply shocks due to its heavy reliance on Middle Eastern imports. Meanwhile, traders stayed alert for possible intervention by Japanese authorities as the yen approached its lowest levels since July 2024, when Tokyo stepped in to support the currency.
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Yen Weakens as Iran War Weighs
The Japanese yen depreciated past 158 per dollar on Wednesday, remaining under pressure as heightened uncertainty over the Middle East conflict continued to support the dollar. The Trump administration sent mixed signals on the Iran war, with President Donald Trump saying the conflict could end soon, while senior officials indicated that military operations were intensifying and that diplomatic talks remained unlikely. Iran’s Revolutionary Guards dismissed Trump’s claims, warning that the blockade would continue until US and Israeli attacks cease. Meanwhile, oil prices declined further after reports that the IEA proposed the largest release of oil reserves in its history to help calm markets. Japan is highly vulnerable to oil shocks given its reliance on energy imports, but the country stands ready to tap its emergency reserves to offset supply risks. Meanwhile, data showed that producer prices in Japan rose 2% in February, marking the softest increase in nearly two years.
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