FRANCE: The yen gained against the euro in Asia Monday after emergency Greek debt talks fell apart over the weekend, enhancing the Japanese currency’s allure among risk-averse investors.
The euro took a tumble after Greek Prime Minister Alexis Tsipras made a call to hold a referendum on July 5 on country’s debt conditions, followed by news the European Central Bank won’t increase the lifeline of emergency liquidity that has been sustaining Greece’s banks.
In early Asian trade, the common currency briefly sank to a one-month low of ¥133.76. Against the U.S. dollar, it fell to as low as $1.0950 compared with $1.1205 in New York Friday.
When global turmoil erupts, the yen typically rises as it is seen as a safe-haven currency.
The Greek “developments run counter to pre-weekend optimism that Greece and its lenders could finally clinch a last-minute deal,” said Kengo Suzuki, chief forex strategist at Mizuho Securities.
“What we are seeing now are (market participants) buying yen as their first reaction.”
Also driving people away from the euro, a Greek official said banks would be closed for six days starting Monday in a bid to prevent the banking system from collapsing.
