Traders Flock to Franc and Krona as Yen's Carry Trade Appeal Wanes

Carry traders are shifting their focus from the yen to other currencies as its appeal ebbs. According to Russell Investments Ltd. and Allianz Global Investors, the Swiss franc is a prime candidate for carry trades due to widening monetary-policy divergence between Switzerland and Japan.

JPMorgan Chase & Co strategists also recommend the Swedish krona and the Canadian dollar as attractive options. The yen's recent surge has made it less reliable than in the past, which may lead traders to seek alternative currencies with higher yields.