Yen Joins Dollar in Rally to Downside

  January 02nd, 2013 at 14:01, Vladimir Vyun

1,000 and 10,000 Japanese yen notesThe Japanese yen joined the US dollar in the decline today as US politicians managed to avert the financial cliff in the United States and traders were selling safe assets amid the resulting risk appetite.

Safe currencies, namely the dollar and the yen, were very weak today amid celebration of what looks like the end of the yearlong worries about the potential financial disaster in the United States. The Japanese currency was falling even versus the greenback as the probability of another intervention from policy makers added more pressure on the currency. Akira Amari, the Minister of State for Economic Revitalization, said that the new Bank of Japan’s Governor, who will replace Masaaki Shirakawa in April, should “share this sense of crisis and realize Japan is losing its position as a major economic power”.

USD/JPY climbed from 86.62 to 87.09 as of 13:01 GMT today and its daily high of 87.31 was the highest since July 2010. EUR/JPY surged from 114.18 to 115.36 and the daily maximum of 115.93 was highest since July 8, 2011.

If you have any questions, comments or opinions regarding the Japanese Yen, feel free to post them using the commentary form below.

6 Comments

  1. Sab

    How bout GBP/YEN, any predictions on how this pair may behave going forward?

    • Like all other JPY pairs, GBP/JPY will probably go up.

      • Sab

        I bought in long @ 142.71 and made lost quite a bit, do you think it will go back to that level or should one close now? :(

        • Should have exited long time ago. I’d exit now as there is no telling when the rally returns.

          • Sab

            :( done that 12.5k lighter… Thanks for your reply. I would have thought the yenny would continue to weaken :s

          • It probably would but you have to set your stop-loss goals on every trade rather than waiting for the market to surprise you by behaving in an unexpected way.

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