Dollar falls half a cent as investors pile into yen

Investors have piled into the yen, leaving the Aussie at a four-year low against the Japanese unit.

The Australian dollar is being sold off amid a strong Japanese yen rally and a patchy jobs report.

At 5.51pm (AEST) on Thursday, the local unit was trading at US73.53 cents, down from 74.07 cents on Wednesday.

The Bank of Japan’s decision on Thursday to hold rates unchanged sent the yen soaring, ThinkForex senior market analyst Matt Simpson said.

The Aussie dollar fell to a four-year low against the yen as investors dumped the currency for the Japanese unit, and at 5pm AEST was at 76.17 Japanese yen, down sharply from 78.44 yen on Wednesday.

“A bearish close below 77.60 yen overnight could instil a fresh bout of selling tomorrow,” Mr Simpson said.

Meanwhile, the latest local jobs numbers did little to arrest the Aussie’s fall.

There were 17,900 jobs created in May, but they were all part-time.

“When we consider there was no contribution from full-time jobs then it becomes a little underwhelming,” Mr Simpson said.

With the remainder of the week clear of risk events, Mr Simpson tipped the Australian dollar to trade between 75 and 73 US cents until next week.

At 5pm AEST, the Australian dollar was at 65.11 euro cents, down from 65.75 euro cents on Thursday.

Bonds soared after both the US and Japanese central banks held rates steady.

At 4.30pm AEST, the September 2016 10-year bond futures contract was trading at 97.985 (implying a yield of 2.015 per cent), up from 97.917 (2.083 per cent) on Wednesday.

The September 2016 three-year bond futures contract was at 98.540 (1.460 per cent), up from 98.485 (1.515 per cent).

AAP