Yen Strengthens as U.S. Banks Face Loan Challenges

According to BlockBeats, the yen continued to strengthen on Friday, causing the dollar to fall below the 150 mark against the yen, retreating from its highest point in eight months. This movement was driven by bad loans at two U.S. banks, increasing global demand for safe-haven assets. On Friday, the yen outperformed most of its Group of Ten peers, with the dollar dropping over 0.5% against the yen to around 149.63, marking its lowest level since October 6. The Swiss franc also rose, while both the dollar and U.S. Treasury yields fell amid a sell-off in regional bank stocks. Strategist Mark Cranfield noted that forex traders looking back at 2023 will remember the regional banking crisis when the dollar-yen exchange rate fell approximately 800 points from its peak to its low. If a similar situation occurs now, the currency pair could drop towards the 146 range low this month. The key driver remains the sharp decline in U.S. Treasury yields, with the two-year yield falling to levels last seen three years ago. As traders price in the Federal Reserve's target rate reaching the 3% range, there is ample room for further downward adjustment.