The yen rallies across the board on Wednesday morning in Asia as traders sought safe-haven assets ahead of the U.S. Presidential poll results.
Risk-aversion grew as the uncertainty about the outcome of the presidential race between President Barack Obama and Republican challenger Mitt Romney hopefully draws to a close.
There are a lot of economic challenges in the road ahead of the next president no matter who wins the race including the monetary policy, tax reforms and spending cuts.
The yen jumps to 8-day highs of 127.77 against the pound and 84.69 against the Swiss franc in the morning, compared to Tuesday's North American session closing values of 128.59 and 85.27, respectively.
Near-term trends are bullish for the yen against the pound and the Swiss franc as both pairs are approaching channel support lines in the daily time-frames, with target being seen at 127.30 and 84.50, respectively.
Shop price inflation in the UK accelerated to 1.5 percent in October from 1 percent in September, the British Retail Consortium (BRC) said in a report today.
Food inflation increased to 4 percent from 3.1 percent in September. Non-food prices were broadly flat during the month following a 0.2 percent fall in the previous month.
"Wet summer and higher feed costs are affecting vegetables and meat and poor supplies on world markets are making the ingredients for some manufactured foods more expensive," BRC Director-General Stephen Robertson said.
The yen advanced to 6-day highs of 79.85 against the US dollar and 65.92 against the New Zealand dollar on Wednesday morning in Asian trading. If the yen extends its advance, likely resistance levels are seen at 79.75 against the greenback and 65.60 against the kiwi.
The yen also strengthened against the rest of majors, rising as high as 102.31 against the euro, 83.30 against the Australian dollar and 80.45 against the Canadian dollar. On the upside, the yen may find target levels at 101.80 against the common currency, 83.20 versus the Australian unit and 80.25 against Canada's loonie.
Australian construction activity contracted for the 29th consecutive month in October, but the pace of weakening slowed down a bit, according to an industry study.
The Australian Industry Group / Australian Housing Association performance of construction index showed activity rising to an index of 35.8 in October, up from 30.9 the previous month.
Looking ahead, German industrial production for September and the wholesale price index for October, the eurozone retail sales for September and the Swiss consumer price index for October are expected in the European session.
The U.S. consumer credit and the weekly crude oil inventories are the key data to watch in the North American session.
by RTT Staff Writer
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