Investing.com – The U.S. dollar fell Thursday as fears of a global slowdown led to a spike in the yen.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, slipped 0.49% to 95.95 as of 10:56 AM ET (15:56 GMT) while USD/JPY slumped 1.15% to 107.61.
The yen was 4.4% higher earlier in the session after a flash crash in Asia due to automated orders. The crash spilled into other currency markets, as Japan is still on holiday for the New Year.
The yen is often considered a safe haven in times of global uncertainty.
“It’s a continuation of some of the market anxieties related to China, the U.S. and more specifically there is a reevaluation of the dollar as a safe haven,” said Jane Foley, currencies analyst at Rabobank.
Global equities also tumbled on Thursday after Apple (NASDAQ:AAPL) lowered its forward guidance, citing a decline in Chinese sales due to the U.S.-Sino trade war weakening China’s economy.
Slowing growth in the manufacturing sector in the U.S. also rattled markets, as investors worry over slowing economic growth. The ISM manufacturing PMI index fell to 54.1 in December, compared to forecasts for a reading of 57.7.
Elsewhere, GBP/USD inched down 0.02% to 1.2603. The euro was higher due the lower dollar, with EUR/USD rising 0.5% to 1.1392. NZD/USD increased 0.4% to 0.6680, while AUD/USD rose 0.16% to 0.6995. The Canadian dollar increased, with USD/CAD down 0.46% to 1.3513.
— Reuters contributed to this report.