Yen gapped up around 60 pips against Dollar and trading strong against almost all of its major counterparts benefiting from talks failure in Doha between oil producers’ and 7.3 magnitude aftershock hitting southern Japan on Saturday.
First earthquake was felt in Kyushu island on Thursday, which was near 7 magnitude in scale of 10 but 500 aftershocks have occurred since and about 70 of them were above 4, which is sufficient to move buildings. Deadlier once of 7.3 magnitude aftershock hit Kumamoto area, which is Japan’s one of key manufacturing hub, leading to thousands injured and building collapse. Factories have been shut. Both Sony and Toyota have closed down their factories in the region. There are three nuclear plants in the region, which so far is said to be not affected by the quake. Biggest crisis in the area is now lack of shelter, food and drinking water.
In 2011, a 9 magnitude quake rocked Japan, leading to a massive Tsunami, killing 20,000 people and worst nuclear disaster in Fukushima Daichi, since the Chernobyl.
As factories went offline and insurers assessing the damage, risk aversion led to massive drop in Nikkei, which was down more than 3% at one point. However, it has recovered since and now down a little more than 2%, trading at 16260.
Yen naturally strengthened against Dollar, currently trading at 107.9, up 0.65% against Dollar.
In a separate event, talks failed in Doha, as producers couldn’t agree to a production freeze amid opposition from Saudi Arabia, regarding non-participant Iran. That also fuelled risk aversion and flight to Yen.
