Swiss Franc and Yen Surge as DeepSeek AI Challenges U.S. Tech Dominance
The Swiss franc and Japanese yen have seen a rise in value as investors shift towards these currencies, seeking safe havens in light of growing concerns about the future of the U.S. tech industry. This shift was prompted by the introduction of DeepSeek, a Chinese AI startup, which cast doubt on America's dominance in artificial intelligence.
The move to these safer assets led to a 1.1% drop in the USD/JPY pair, reaching a near six-week low of 153.723. Similarly, the EUR/CHF fell 0.5% to 0.9450. Deutsche Bank’s forex analyst, George Saravelos, indicated that if DeepSeek's AI model turns out to be a significant technological breakthrough, it could weaken the U.S. dollar over time.
While the dollar had initially gained strength due to safe-haven demand, the potential for a global spread of technology that reduces the U.S.'s unique edge might lead to a marginally negative outlook for the dollar.
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