Forex News

The Japanese currency posted a poor performance this week as the economic recovery prospect is not leading traders to believe that interest rates will be raised from an all time record low, decreasing significantly the attractiveness for the Asian nation’s currency.

Several negative reports affected the yen’s outlook as consumer prices declined in Japan during the past month, and the nation’s unemployment rate grew for the first time since July, being both reports extremely influential to fuel speculations that interest rates in the country will remain at an all-time record low, as the Bank of Japan is likely to insist on low borrowing costs to accelerate the pace of recovery in Asia’s wealthiest country. The greenback also declined versus the several currencies this week, as the outlook for interest rates hikes in the U.S. declined on Federal Reserve rather dovish statements.

The Japanese economy is affecting the yen’s performance directly, according to analysts. A solid paced improvement in the nation’s economic conditions declined slightly towards the end of the year, declining expectations that a more attractive monetary policy will be implemented anytime soon, declining the appeal for yen-priced assets in currency markets.

EUR/JPY closed the week at 131.68 from as low as 129.45 in the beginning of the weak.

If you want to comment on the Japanese yen’s recent action or have any questions regarding this currency, please, feel free to reply below.

Earlier News About the Japanese Yen:

• Yen Down on U.S. Optimism (2009-12-21)
• Yen Falls on BOJ Low Rates Policy (2009-12-18)
• Yen Falls for 2nd Day on Deteriorating Conditions in Japan (2009-12-11)
• Yen Advances Despite GDP Growth Slowdown (2009-12-09)
• Yen Drops on Intervention Talks (2009-12-02)

This entry was posted on Saturday, December 26th, 2009 at 9:33 pm and is filed under Japanese Yen. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.