Rally Fueled Risk Aversion Sentiment Yen; Aussie Drops

The yen rose to a 6-week high against the dollar earlier in the session Monday and headed 2-year highs against the Australian dollar as safe-haven buying by investors against the Japanese currency strengthened as risk aversion sentiment. Anxiety about the economic slowdown in China, as well as global, warming up on Friday after a survey showed that China's manufacturing sector activity slowed. This coupled with a sharp decline in China's stock exchanges, triggering a domino effect pushed European stock markets and Wall Street scored its biggest daily decline in nearly four years.

Investors also trimmed bearish positions against the euro, pushing the euro up against the dollar around $ 1.1440. Traders said the greenback showed weakness in the market doubts that the Federal Reserve will raise interest rates next month. 'Risk off' is still one of the dominant themes in the currency markets, the yen and the euro is expected to continue to strengthen. If the continued high volatility, the possibility of aussie and kiwi will continue to be depressed, according to analysts at ANZ. There is no important data will be released on Monday's Asian session, making the focus fixed on China's stock market movements.