The Japanese yen ended Friday with a small gain versus the US dollar and continued its rally to the downside against the euro and the Great Britain pound.
The advance of the yen did not affect the huge weekly loss versus the greenback in any noticeable way. This weekend Japan faces election and it is widely believed that Liberal Democratic Party of opposition leader Shinzo Abe will come a winner. Abe preaches easing measures as a way to bolster economy and his victory will likely mean a weaker currency.
Outside of Japan, Forex traders look at the United States to guide their actions. The USA affect the FX market in a mixed way as the improving employment market and stimulating measures from the Federal Reserve cause optimism, while the threat of the fiscal cliff spur fears. Europe currently resides in a background, not affecting markets to a great degree, but it looks like the situation there is improving.
USD/JPY fell from 83.63 to close at 83.50 after touching 83.95 — the highest level since March 21. EUR/JPY rallied from 109.36 to 109.83 — the highest close since April 2. GBP/JPY went up from 134.75 to 134.89 and its daily high of 135.37 was highest since May 2, 2011.
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