Asian currency was in full safe-haven appeal Thursday morning as traders sought a harbor amid rising trade jitters.

🛫 Yen Soars to 10-Week High

• The USDJPY pair tumbled to a 10-week low of ¥150 as the stronger Japanese yen trounced dollar bulls’ efforts. The Asian currency had the momentum going for it as trade tensions prompted forex speculators to seek a safe haven in the currency space. Naturally, the yen stood out.
• Donald Trump and his hostile approach to imports is threatening to upend the global flow of trade. It’s especially risky for America’s biggest trade partners China, Europe and Canada.

⚖️ Tariffs Coming for Everyone?

• Earlier this week, Trump unveiled sweeping 25% tariffs on all auto imports, potentially hurting Europe the most. The old continent was importing its cars at a 2.5% levy while it collects 10% tax charges on all US cars. China was the first to get the special treatment earlier this month with a 10% duty on all imports.
• The brewing tensions are causing the US dollar to stumble as it’s having some difficulties figuring out how to respond properly to all that’s happening. The dollar index is down roughly 3% since mid-January.

🤝 Yen and Rates

• As for the Japanese yen, the Bank of Japan is expected to bump up its benchmark interest rate at least one more time this year, a Reuters poll showed earlier today. The central bank already hiked borrowing costs this year when officials met in January and raised rates to a 17-year high.
• The yen is typically sensitive to rate moves as they dictate the level of its yield — higher rates mean higher yields, which means a better appeal. Apparently, only the prospects of higher rates are enough to send the yen soaring.