The yen strengthened against the dollar in morning trade in Asia Tuesday after U.S. president Donald Trump raised the possibility of imposing new tariffs on US$200 billion worth of Chinese goods. Investors are entering risk-off-mode as worries mount over a U.S.-China trade war and the risk-off mode is benefiting the safe-haven yen.
The US dollar index, which tracks the dollar against a basket of six major currencies, fell 0.15% to 94.27 by 12:30PM ET (04:30 GMT).
The USD/JPY pair slid 0.74% to 109.73 after Trump said the U.S. may impose 10 percent tariffs on $200 billion worth of Chinese goods.
In a statement on Monday, Trump said he had asked U.S. representatives to identify Chinese goods that would be subject to the new tariffs. The move would be in retaliation for China’s decision to raise tariffs on $50 billion in U.S. goods, which was in itself in response to new U.S. tariffs.
