The yen had its biggest weekly advance against the dollar in 16 months as the market contagion from the rout in crude oil prices drives investors to haven currencies and Japan prepares for national elections.
The Bloomberg Dollar Spot Index fell for the first week since October as the collapse in inflation expectations causes investors to rethink what the Federal Reserve may do at a meeting next week. Russia’s ruble reached a record low as oil sank, while the Swiss franc rose to the strongest since September 2012 versus the euro.
“The key factor is obviously oil prices — they continue to slide very rapidly,” Mark McCormick, a foreign-exchange strategist at Credit Agricole SA in New York, said by phone. “Anything linked to the oil story is coming under massive pressure.”
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