Yen Soars as Middle East Tensions Push Dollar Down

The yen has become a safe haven for investors as tensions in the Middle East push oil prices towards $100 per barrel, causing the dollar to weaken.

Oil prices rose by over 1.48% on Wednesday, with Brent crude futures reaching $99.37 per barrel, after Iranian-backed Houthis launched strikes on several Saudi cities and US forces hit multiple Iranian oil tankers.

The yen has been on a seven-month high, with the Japanese currency steady near its strongest level since February at 153.65 per U.S. dollar.

Analysts attribute some of the dollar's weakness to the rapid rise of the yen in the past week, but expect higher oil and yields to limit USD downside ahead of key US inflation data on Friday.