The US dollar has plunged to the bottom vs the yen on Tuesday depressed by US-China trade tensions.
The US dollar-to-yen exchange rate fell to some 109.68 on Tuesday morning, posting an all-time record over the week.
At the same time, the Japanese currency has progressed on the back of the Beijing's statement. The Chinese authorities said that Donald Trump might face countermeasures against the planned 10% import duty on Chinese products worth $200 billion in total.
Thus, the large-scale trade war between the major world economies is getting more and more real. In this situation, demand for the yen is strengthening. For reference, Japanese currency usually enjoys high demand when the market faces political instability.
Besides, additional pressure came from the NAFTA perspective as well as duties on European products in the USA.
As a result, the euro-to-yen exchange rate dropped to some 126.79. The European currency also lost grounds vs the greenback reaching 1.1555. For now, investors are focused on the forum of the European Central Bank in Portugal. In particular, Mario Draghi, ECB Chairman and Peter Praet, ECB senior economist, are about to make a speech today.