Haven demand boosts yen after U.S., EU impose sanctions on Russia

The yen soared against majors on Thursday as the U.S. and EU imposed sanctions on Russia spurred haven demand.

The U.S. and EU imposed new sanctions on Russian banks, energy companies and defense firms to stop its interference in Ukraine’s internal affairs.

The sanctions have returned the focus on the Ukraine dilemma, raising concerns the relations between the West and Russia.  

The USDJPY retreated from a peak of 101.68 to hit a low of 101.38, where it is currently trading around 101.45.  

The dollar index, which tracks the green currency movement against a basket of six major currencies, steadied close the session’s opening around 80.56.

Reports released from the U.S. today showed that initial jobless claims dropped to 302,000 last week from a revised of 305,000. Housing starts plunged 9.3 percent from a revised of -7.3 percent.

The dollar edged up to a three-week high on Fed Chair Janet Yellen comments as she referred interest rates could be raised earlier than predicted if both inflation and labor market data showed remarkable progress.

The EURUSD inched up, following sharp losses over the previous two sessions, after a report showing euro area CPI inflation steadied at 0.5 percent in the year ended June.

The pair is meanwhile trading around 1.3528 after touching a high of 1.3538 and a low of 1.3519.

The GBPUSD dropped for a second day on profit taking after hitting a peak of 1.7188 this week.  

The pair slipped to a bottom of 1.7093 after hitting a high of 1.7142.