Japanese yen is higher today, gaining due to its status as a safe haven as concerns about the global economy once again take center stage. However, the latest economic data from Japan suggests that more weakness could be coming for the yen.
Yen is higher today as risk assets drop in the markets. Concerns about the eurozone GDP are rising, and even though jobless claims dropped in the United States, the economy is still recovering at a rather sluggish pace. As a result, worries are pushing Forex traders to safe haven, and that is helping the yen gain across the board.
However, yen strength may not continue. The latest economic data from Japan indicates that there was a 0.4 per cent annualized contraction for the fourth quarter of 2012. This news has many speculating that new Prime Minister Shinzo Abe will make good on his reputation for aggressive monetary policy. That kind of easing could result in a lower yen in the near future, even though the Japanese currency is showing strength now.
At 14:16 GMT yen is higher across the board against its major counterparts. USD/JPY is down to 93.1875 from the open at 93.3920. EUR/JPY is down to 124.2060 from the open at 125.6350. GBP/JPY is down to 144.5015 from the open at 145.1450.
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