Yen climbs as U.S. recession gauge flashes red
The Japanese yen jumped to the day's high on Wednesday as the United States bond yield curve inverted for the first time since 2007 as investors, gripped by worries of a looming global recession, fled to the safety of perceived safe-haven assets.
An inversion of the U.S. Treasury yield curve – when short-dated bond yields fall more than their longer-dated counterparts-- is considered as a classic recession warning and the drop in bond yields sent a chill through global markets after concerns of a U.S.-China trade dispute receded somewhat.
The yen, which was already trading stronger on the day, received a further boost and headed towards a near 1-1/2 year high versus the U.S. dollar.
The Japanese currency strengthened to 105.83 versus the dollar, its highest on Wednesday, up 0.6% on the day.
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