safe-haven currencies namely the yen, franc and the dollar rose against their key counterparts

Tuesday in Asian deals, safe-haven currencies namely the yen, franc and the dollar rose against their key counterparts on concerns the Japan's economy will be crippled due to major accidents in its nuclear plants.

The U.S. dollar, Japanese yen and the Swiss franc are considered as safe-haven currencies as these nations have lower lending rates, which help traders to borrow and invest in other countries where returns are higher.

Japan's Prime Minister Naoto Kan said "substantial amounts of radiation are leaking in the area."

Also, latest reports indicate that radiation level at the troubled nuclear plant in Fukushima Prefecture shot up today morning following an explosion at one of its reactors.

Asian stocks extended their losses. Thus far, Japan's Nikkei 225 index fell 12.4 percent, Hong Kong's Hang Seng slipped 3.8 percent, China's Shangai composite index dropped 2.1 percent, New Zealand's NZX 50 index lost 1.4 percent, South Korea's Kospi declined 2.8 percent and Taiwan's main index plunged 4.4 percent. Australia's S&P 200 index and the All Ordinaries index lost 2.2 percent each.

The Swiss franc strengthened to near a 2-week high of 0.9221 against the US dollar and a 4-day high of 1.4880 against the pound and 1.2850 against the euro.

The U.S. dollar rose to a 4-day high of 1.3895 against the euro, near a 3-week high of 0.9849 against the Canadian dollar, 6-week high of 0.9934 against the Aussie and a new multi-month high of 0.7298 against the NZ dollar.

Meanwhile, the yen climbed to near a 3-week high of 82.81 against the Canadian dollar and new multi-month highs of 59.49 against the aussie and 81.0 against the NZ dollar.

But the yen gained slightly against the currencies of U.S., Europe, U.K. and Switzerland in the Asian session. As of now, the yen is worth 81.50 against the dollar, 113.52 against the euro, 131.40 against the pound and 88.26 against the franc.

In the upcoming European session, the French CPI for February, U.K. DCLG house price index for January, Eurozone fourth quarter employment data and the German ZEW economic sentiment index for March are slated for release.

Across the Atlantic, the U.S. import and export price indexes for February, results of the New York Federal Reserve's empire state manufacturing survey for March, Treasury Department's report on the flows of instruments into and out of the U.S. for January and NAHB housing market index for March are expected in the New York morning session.

The Federal Open Market Committee is scheduled to commence a 1-day meeting, with the central bank expected to make an announcement regarding its near-term direction of monetary policy at 2:15 pm ET.

by RTT Staff Writer