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Forex pairs in this Article » EUR/USD (Barcelona) - Lee Hardman, FX Analyst at the Bank of Tokyo Mitsubishi UFJ notes that the sharp Emerging Market sell off has made investors more risk adverse.

Key Quotes

"The sharp emerging market currency sell off over the past week has resulted in global investors becoming more risk averse with Asian equity markets continuing to fall again overnight. A flight to quality bid has also resulted in yields in the US declining modestly with the 10-year US Treasury bond yield falling back towards 2.7% from a recent peak of just above 3.0%."

"The weakest performing emerging market currencies over the past week have been the Argentine peso, Turkish lira, Russian rouble and South African rand which have declined by around 15%, 4%, 3.5%, and 2.5% respectively against the US dollar since the 17th January. In contrast, the G10 currencies have continued to remain relatively stable."

"The traditional safe haven currencies of the yen and Swiss franc have strengthened only modestly by less than 2% against the US dollar. While the high beta, commodity linked G10 currencies of the Canadian, Australian, and New Zealand dollars have all weakened by less than 1% against the US dollar."
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