The yen and the euro rose against the dollar on Monday on growing expectations that the U.S. Federal Reserve will cut interest rates at its policy review this month to protect the economy from the rapid spread of the coronavirus.

As U.S. shares were routed in recent days, Federal Reserve Chair Jerome Powell said on Friday the central bank will “act as appropriate” to support the economy in the face of risks posed by the coronavirus epidemic.

Investors took his comments as a hint that the Fed will cut interest rates by at least 0.25 percentage point at its next scheduled meeting on March 17-18.

The yen rose to as high as 107.00 to the dollar in early Monday trade and last stood at 107.75 yen up 0.3% from its levels in New York late on Friday.

The Japanese currency had risen 3.2% last week, the biggest gain since July 2016. Japan's current account surplus and the yen's vast liquidity make the yen behave like safe haven asset.

The euro stood at $1.1042 up 0.14% so far in Asia, trading near its highest level in almost a month after a 1.7% gain last week, the largest in two years.

Source : Reuters