Global Markets Steady as Yen Holds Firm After Japan Earthquake Amid Central Bank Focus

The yen traded steadily in early Asian markets after a powerful 7.5-magnitude earthquake struck northeastern Japan overnight, triggering evacuation orders and initial tsunami warnings that were later downgraded. The U.S. dollar held flat at 155.885 yen as investors assessed potential disruptions linked to the quake. Analysts noted that the immediate reaction revived concerns over supply-chain vulnerabilities, insurance losses, and potential delays in industrial production, adding to the broader risk-off sentiment already gripping global markets.

The Australian dollar also remained stable at $0.6626 ahead of the Reserve Bank of Australia’s policy announcement, where the central bank is widely expected to keep interest rates unchanged. Market participants are bracing for a tightly packed week of monetary policy decisions, with major attention on the Federal Reserve. Investors largely anticipate a rate cut during the Fed’s December 9–10 meeting, with futures pricing in an 87% probability of a 25-basis-point reduction.

The U.S. dollar index edged up 0.1% to 99.092, retreating slightly from last week’s highs. U.S. Treasury yields also dipped, with the 10-year benchmark easing to 4.168% after a three-day climb. Analysts at ING noted that the recent shift toward higher yields appears justified by underlying economic fundamentals.

In Europe, the euro steadied at $1.164075 following a notable selloff in German bunds. Market reaction followed remarks from ECB board member Isabel Schnabel, who suggested that the bank’s next policy move could be a rate hike, although likely not in the near term. Meanwhile, the British pound held at $1.332, and the offshore Chinese yuan traded at 7.07 per U.S. dollar. The New Zealand dollar was unchanged at $0.57755.

In the cryptocurrency market, bitcoin and ether both slipped 0.8%, reflecting cautious sentiment across global risk assets.