The Japanese yen advanced for a second day against most of its major counterparts, as commodity prices and Asian stocks declined. The dollar also was able to achieve more gains versus the euro and sterling, since fears counted to dominate FOREX market movements.

The risk aversion is back in the financial markets, with demand rising for safe heaven currencies versus higher-yielding. Most of the countries around the world declared a state of emergency in their embassies and airports, fueling risk aversion and low demand for higher assets.

On the other hand, speculations that China might introduce more tightening measures to curb inflation increased demand for the Japanese currency as a safe heaven currency.

The People’s Bank of China mentioned before that curbing inflation is the main priority for the bank, so we could see more interest rate hike or increase in the Central Bank’s Reserve Requirements, fueling demand for safe assets.

On Thursday, the US economy is to release its unit labor costs (1Q P) at 12:30 GMT that expected to increase by 2.1% after a drop by 0.6% in 4th quarter. While the non-farm productivity for the first quarter is expected to increase by 0.5% compared to the previous reading of 2.6%.

At 12:30 GMT, U.S economy will release the weekly initial claims, where the number of people filing for first-time unemployment insurance is expected at 429 thousand.