Trade Turmoil Sends Yen and Swiss Franc Closer to Six-Month Highs

The yen and Swiss franc approached six-month highs as financial markets faced recession fears due to Trump's tariffs. Investors sought safe havens, causing volatility. The dollar, once seen as a safe asset, weakened amid fears of a downturn and expected interest rate cuts, affecting global stock markets.

The yen and Swiss franc neared six-month peaks on Tuesday as financial markets remained on edge over possible recession risks triggered by President Donald Trump's sweeping tariffs. In a climate of volatility, these safe-haven currencies saw increased investor interest, while the U.S. dollar experienced broad losses.

The market's instability followed Trump's tariff announcements, which led to retaliatory responses from China and the European Union and deepening trade tensions. Investors have increasingly turned to safer currencies like the yen and Swiss franc, both hitting multi-month highs against the U.S. dollar.

While typically considered a safe asset, the dollar's appeal has diminished amid growing recession concerns and the potential for rate cuts to address these fears. As the dollar index fell, other currencies like the euro and sterling saw marginal gains. The Federal Reserve remains cautious, weighing the need for future monetary adjustments.

(With inputs from agencies.)