One signal

Goldman Sachs says the yen is becoming a more attractive hedge against a broad AI-driven market shock, as Japan’s policy backdrop makes it less vulnerable when global yields rise. The yen rose 0.9% against the US dollar on 22 October, then gave back some gains as US yields stabilised, the Straits Times reports.

The bank’s strategists argue that a shock pushing both shares and bond yields down could favour the yen. They still see risks, including the prospect of further yen weakness, so this is a shift in the hedge case, not a forecast that the currency only goes one way. A useful reminder that an AI boom can move markets well beyond the technology sector.

Discuss: Would you trust the yen as protection against an AI-market wobble, or is that asking one currency to do too much?

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