With uncertainty over the health of the global economy continuing to grow, it’s unsurprising that the safe haven Japanese Yen continues to be pushed higher by worried traders. That is even despite the fact that the Japanese government has fired yet another cautionary shot, allowing investors time to get ready for the next possible intervention in the Yen’s appreciation. It seems that, all things considered, FX traders find the Yen the better option and earlier today had pushed the USD/JPY pair to a fresh 17-month trough.
At 10:50 am (BST), the USD/JPY pair was trading at 108.0760 Yen, a gain of 0.01% and just off the pair’s opening price; the pair has ranged from 107.6445 Yen at the low end to 108.3250 Yen at the top side. The EUR/JPY is lower at 123.0200 Yen, down 0.15% within a daily trading range of 122.8257 Yen at the low end and 123.5450 Yen at the high.
Yen Movement Driven by Alternate Markets
Analysts say that the Yen’s movements this week will likely be driven by the movement in the equity and credit markets. Last week, the S&P500 lost 1½ % of its value for the week, but if upward momentum resumes that could give investors reason to move away from the safe haven assets. What could temper speculation of a Yen intervention is the upcoming G20 and G7 meetings; typically, government and central banks try not to raise the ire of peers by intervening in the currency markets rather than allowing market forces to drive the direction.