Yen, Swiss franc rise versus dollar as U.S. stocks sell off - Metro US

Yen, Swiss franc rise versus dollar as U.S. stocks sell off

Saudi riyal, yuan, Turkish lira, pound, U.S. dollar, euro and Jordanian dinar banknotes are seen in this illustration

NEW YORK (Reuters) – The Japanese yen and Swiss franc strengthened against the dollar on Thursday afternoon as a selloff in the U.S. stock market drove investors into the safe-haven currencies.

Big falls in Apple Inc <AAPL.O>, Amazon.com <AMZN.O>, Microsoft <MSFT.O> and Google parent Alphabet <GOOGL.O> pushed Wall Street’s main indexes lower on Thursday, on track for their deepest one-day dives since June. Analysts said that the move was broadly driven by weak economic data highlighting concerns about a long and difficult recovery.

The dollar was 0.1% lower against the yen <JPY=> and will end the North American session lower for the first time since last week. Against the Swiss franc <CHF=>, the dollar was 0.15% weaker at 0.909 francs.

About the dollar-yen pair, analysts at Action Economics wrote: “As the risk-backdrop turned decidedly negative, the risk-sensitive pairing sold off to 106.02 lows. A sharp slide on Wall Street, along with lower Treasury yields weighed.”

A report from the Labor Department showed that the number of Americans filing new claims for unemployment benefits fell more than expected last week. But the figure still remains extraordinarily high, one of several signs that the labor market recovery has been losing steam as the COVID-19 pandemic continues and government support lapses. And some analysts argued that a seasonal adjustment may have made the drop appear bigger than it was.

“The seasonal adjustment issue means we cannot really compare initial claims to the prior reads at this moment,” said Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets.

“Our takeaway is that the adjustment methodology makes the drop in initial claims appear larger than it actually was.”

On Friday, the Labor Department will release its closely watched jobs report for the month of August.

Against the euro <EUR=>, the dollar was virtually flat. Earlier in the day it hit a week high as investors trimmed bets against the greenback and sold the euro on concerns that the European Central Bank was worried about its rise. The surge has lifted the greenback out of the 28-month low it hit against a basket of currencies on Tuesday.

The dollar index <=USD> was last up 0.09% to 92.78. It is 1.12% higher from the bottom hit on Tuesday.

(Reporting by Kate Duguid in New York and Olga Cotaga in London; Editing by Marguerita Choy)

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