Yen Advances, Japan Worried — New Intervention is Coming?

The Japanese yen advanced today, heading to the highs against the dollar last seen during the post-World War II period, and made the Japanese government even more nervous about the currency’s strength.
Investors seek safer assets after North American and European stocks fell. The Standard & Poor’s 500 Index slid 2.6 percent today and the Stoxx Europe 600 dropped 0.9 percent.
The Swiss franc could be the place for investors to put their money in, but the move by Switzerland’s central bank to weaken the nation’s currency made the yen more attractive than the franc as a safe haven. Traders should be cautious, though, as Japan may also intervene to curb appreciation of its currency. Japan’s Finance Minister Yoshihiko Noda spoke today in parliament about danger of a strong currency to the nation’s economic growth.
USD/JPY dropped from 76.95 to 76.46 as of 15:10 GMT today after falling to the record low of 76.34. EUR/JPY sank from 110.63 to 108.37, while earlier it reached 108.31 — the lowest level since March 17.

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