Japanese Yen Surges as Oil Prices Plummet on Diplomatic Hopes

The Japanese Yen (JPY) has clawed back its early losses and is now trading slightly positively against the US Dollar (USD), with the USD/JPY pair dropping 0.2% to near 157.00.

This turnaround comes as oil prices have corrected sharply on hopes of diplomacy between the United States (US) and Iran, which has weakened the safe-haven appeal of the US Dollar.

According to a senior Iranian Official, Iran's proposal was delivered to the US via mediators on September 16, which includes reopening the Strait of Hormuz within seven days if the US takes initial steps toward easing military pressure.

The hopes of an improvement in energy supply through the Middle East have also contributed to lower oil prices, with Saudi Arabia preparing to resume crude oil exports from the Red Sea port of Yanbu as early as Tuesday and restarting the East-West oil pipeline.