Yen Drops as Demand for Safety Wanes

The Japanese yen dropped today as the rally of the global equities damped the demand for the safer currencies and on the anticipation of the intervention by the central bank.
The Standard & Poor’s 500 Index and the MSCI Asia Pacific Index of shares rose by 0.3 percent each. The improving conditions on the global markets prompted the investors to actively sell the yen, which they bought for the safety in case of the recession. The sell-off cut the Japanese currency’s prices.
The yen also slipped on the speculation that Naoto Kan, the Prime Minister of Japan, and Masaaki Shirakawa, the Governor of the Bank of Japan, may meet next week to discuss the currency’s appreciation. The probability of the intervention by central bank drives the yen down.
USD/JPY rose from 85.33 to 85.50 today as of 19:20 GMT, while EUR/JPY climbed from 109.42 to 110.16.

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