The oil gloom hit Asia’s biggest energy stocks. In Australia, Woodside Petroleum was down 2.5% and BHP Billiton, whose second-biggest division is petroleum, was down 2.3%. Japanese oil explorer Inpex was down 1.7% and in Hong Kong, Chinese oil major Cnooc fell 1.4%.
The drop in oil prices is hitting U.S. inflation expectations, which has pulled down U.S. Treasury yields, which has finally knocked back a lengthy dollar rally.
The yield on 10-year U.S. Treasurys was last at 2.330%, down from 2.359% on Friday, according to Thomson Reuters.
Asian currencies were broadly up Monday. The Korean won gained 0.4% and the Singapore dollar rose by 0.5%.
The Japanese yen was the biggest gainer in Asia on Monday, rising 1.3%, partly as traders sought the safety of the yen on the view OPEC’s production deal was unraveling.
“Guys are very very nervous about the oil scenario and you see that expressed in the sensitive pair,” said Oanda senior foreign-exchange trader Stephen Innes, referring to the U.S. dollar and the yen.
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