LONDON (Reuters) – Safe-haven currencies such as the Japanese yen rose against the dollar on Wednesday as caution prevailed on the first trading day of the new year, amid growing concern about the U.S. government shutdown and spluttering global growth.

In a quiet start to 2019, most other major currencies were little changed, but the yen rallied to a seven-month high versus the dollar.

The yen, which tends to benefit during geopolitical or financial stress, has strengthened for three straight weeks and was the best performing major currency in 2018. In the last four days alone, it has gained 2.2 percent.

“The yen is benefiting from building global slowdown concerns. This might well get more pronounced in 2019,” said Ulrich Leuchtmann, a currency strategist at Commerzbank.

Volatile stock markets have also boosted the safe-haven appeal of the yen. The CBOE Volatility Index .VIX, a widely followed barometer of expected near-term volatility for U.S. stocks, has nearly doubled to 28 from 16 at the start of December.

Leuchtman said the Japanese central bank’s making its monetary policy less expansionary would continue to strengthen the currency.

The dollar fell 0.7 percent against the yen to 108.9. JPY=EBS. The dollar index .DXY was little changed at 96.202.

The euro EUR=EBS weakened 0.2 percent against the dollar to $1.1438.

Traders expect the single currency to remain under pressure as both growth and inflation in the eurozone remain below the European Central Bank’s expectations. The euro lost 4.4 percent of its value against the dollar in 2018.

Spain’s manufacturing sector grew at its slowest pace since August 2016 in December, a survey showed on Wednesday, as easing growth in output and new work weighed.

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