Yen, franc drop on ease in Ukraine geopolitical tensions

The Japanese yen and Swiss franc retreated on Monday trading as expectations of an ease in geopolitical tensions between Russia and Ukraine damped safety demand on both currencies.

Russian Foreign Minister Sergei Lavrov met with his Ukrainian counterpart Pavlo Klimkin in Berlin to negotiate the melting situation, where he mentioned a `certain progress` was achieved during talks.

“Ukrainian forces have raised their national flag over a police station in the city of Luhansk that was for months under rebel control, Kiev said on Sunday, in what could be a breakthrough in Ukraine`s efforts to crush pro-Moscow separatists,” Reuters said.

Now, there are some hopes that negotiations could become fruitful, hence investors opted to pull their money out of haven assets.

European shares rose by midday trading today after posted their largest weekly advance in more than a month.

The USDJPY rose from a bottom of 102.23 to hit a peak of 102.55, while it is currently trading around 102.53.

The USDCHF climbed to trade around 0.9052, compared with the session’s opening of 0.9027.

Tomorrow, eyes will focus on U.S. CPI data, while later in the week central bankers will meet at an annual conference in Jackson Hole, Wyoming.

Data released last from the U.S. raised some concerns, yet the dollar remained firm taking advantage of the drop in euro and pound.

The EURUSD slipped to touch a low of 1.3378 after hitting a high of 1.3397, resuming its drop on worries after a report last week showing euro area growth staled in the second quarter.

The GBPUSD rebounded from four-month low after BOE Governor Mark Carney said over the week end UK interest rates may have to rise even before real wages pick up.

Last week, the BOE slashed its growth and wage forecasts for this year, while revealed the BOE does not have a preset course for interest rates hike, where any rate increase will be gradual and limited.

The pair is meanwhile trading around 1.6727 after opening on an upside gap, where lowest point touched last was at 1.6655.