Japan Yen Rate

vinoth1234

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The dollar fell near [JPY=X 82.06 0.26 (+0.32%) ] 81.89 yen, its biggest one-day decline since Dec. 3, while the yen also rallied against the euro, pound and Swiss franc.

The euro, meanwhile, rose 1 percent toward $1.3894 [EUR=X 1.3922 -0.0038 (-0.27%) ] after leaders reached a deal to establish higher retirement ages, more flexible labor markets and debt and deficit limits for euro zone countries.
 

trader_john

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"The Bank of Japan has also decided to pump 15 trillion yen ($183bn USD) into the markets to improve financial stability in the short term. This should increase the yields on Japanese debt, attracting investment. A similar policy was put in place after the Kobe earthquake in ‘95 and 3 months later USDJPY had lost near 20% to sit at an all-time low. While we are not suggesting that a similar move is likely in the coming 3 months, a strengthening of the yen has to be watched for."
 

trader_john

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JPN is second only to china in holdings of US treasuries, and I believe first or second in worldwide debt ownership. that's why, counterintuitively, the jpy will strengthen when there is bad news coming out of japan. they have to re-patriate their funds for them to be of any use to its citizens. Similar type of situation for most funding currencies with a larger manufacturing/export pinned economy.

In NZ since foreign countries seeking yield differentials account for a much larger portion of ownership, their liquidation activities put downward pressure on the kiwi following the earthquake which is a bit more intuitive.
 
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