Japanese Yen Falls after Bank Rescues

The Japanese yen fell today against the high-yielding currencies (including the Forex majors) after the bank-rescuing measures of the various global central banks helped to cut the inter-bank money-market interest rates.
The South Korea’s measures to provide $100 billion guarantee on the domestic money market helped to ease the debts of the financial companies in the Asian region. The support of the liquidity offer from the U.S., European Union and Asian central banks helped to reduce the demand for the credit money and pushed treasuries and bonds down.
The trend for the strong yen-buying positions will diminish temporarily as the risk-aversion has not enough influence among the traders and more risky assets look highly attractive at the current rates. The fall in the short-term rate and the global volatility will keep yen down for now.
Jean-Claude Trichet, the President of European Central Bank, asked the banks yesterday to start lending the money to each other and the real economy sector after the central bank pumped liquidity into the financial system. If that really worked to reduce the of trust among the banks, the yen may become a less favorable currency in a long term.
USD/JPY rose from 101.62 to 102.00 as of 8:25 GMT today with a daily maximum at 102.41. EUR/JPY rose from 136.24 to 137.49 with a daily maximum at 138.56. GBP/JPY went up from 175.86 to 178.21 today.

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