The Japanese Yen fell to a 9-month low against the U.S. Dollar during the Asian trading session today as investors await the installation of a new Japanese government that is certain to aggressively weaken the Yen in order to growth the Japanese economy, the third largest in the world after the U.S. and China. Japanese media has long been reporting that the Liberal Democratic Party led by Shinzo Abe is poised for a huge victory, thus investors are readying themselves against just such a prospect.
As reported at 1:27 p.m. (JST) in Tokyo, the USD/JPY pair was trading at 83.71 Japanese Yen, falling from a high of 83.95 Yen, a level last struck in March, and the pair is approaching March’s high of 84.187 Yen. The EUR/JPY pair also struck a 8-month peak, trading at 109.63 Yen, and the common currency is poised to close out this trading week with a 3% gain on the Japanese currency.
A recently reported survey of business sentiment in Japan also supported views that the Bank of Japan will move toward an extremely loose policy under the new regime; the tankan survey as conducted by the BOJ showed that manufacturing outlook for the last quarter of the year skidded to a -10 against expectations of a drop to -9 from the third quarter’s reading of -3.