Yen Weakens Against Dollar Amid Middle East Tensions

The yen extended its decline in New York foreign exchange trading on July 13th, settling at 159.50-60 per dollar, down 0.10 yen from the previous day. This modest dip marked a continuation of the currency's downward trend as uncertainty over the Middle East fueled demand for the dollar.

Market participants pointed to the escalating tensions in the region as a key driver of the dollar's strength, with a currency dealer at a Japanese bank noting that 'while this appears to be a pre-planned rotation [of the USS George Washington], it has raised awareness that tensions with Iran could be prolonged.'

The front-month WTI contract traded in the $82-per-barrel range, contributing to yen selling and dollar buying through the deterioration of Japan's trade balance.