Yen tumbles to 24-year low against dollar as stocks mostly fall
October 07, 2022 / 7:05 PM
Sharjah 24 – AFP: Global stock markets mostly fell Thursday, while the yen tumbled to a 24-year low against the dollar as markets grappled with inflation fears and another major Chinese city went into lockdown.
Frankfurt, London and Paris equities closed down between 1.5 and two percent as record-high eurozone inflation fueled fears that borrowing costs are set to climb even higher even as the region faces rocketing winter energy costs due to Russia's war on Ukraine.
The European Central Bank will announce its latest monetary policy decision next Thursday, after delivering its first rate hike in a decade in July.
"More pain is likely for investors as Europe's energy crunch gets worse," said City Index analyst Fawad Razaqzada.
US monetary policy was also expected to remain in focus Friday with the release of the August jobs report, data expected to strengthen the Federal Reserve's commitment to raising interest rates.
Analysts expect the US economy added a solid 300,000 jobs in August and that unemployment remained 3.5 percent.
After a downcast open, US stocks rallied later in the day, to lift the Dow and S&P 500 higher, snapping a four-day losing streak.
Meanwhile the yen plunged to a new 24-year low against the dollar on Thursday as Japan sticks with its long-standing monetary easing policies in contrast to tightening by the Fed.
One dollar was worth more than 140 yen for the first time since 1998 in afternoon deals in Europe, as the greenback also strengthened against other currencies.
The greenback was also at its strongest level against the pound since the height of the pandemic in 2020, with sterling buying less than $1.16.
Asian equities weakened further Thursday as traders continued to digest shrinking factory activity in powerhouse economy China.
Shanghai also dropped after news that the Chinese city of Chengdu would effectively lock down around 16 million people in a bid to contain a Covid-19 outbreak, likely dealing another blow to a stuttering economy.
Oil prices slumped more than three percent on growth worries as well as concerns easing about a possible decision by OPEC+ members to cut production to support prices that Saudi officials had posited last month.