The Japanese Yen rallied to a 5-week high against the U.S. Dollar today as faltering global stock markets reflected investors’ continued concerns about risk and the degree of the global economic problems.
According to information released by the U.S. National Bureau of Economic Research yesterday, the U.S. economy has been in recession for almost a year, and that information actually confirms investors’ long-held view that the U.S. economy had been in a recession already.
According to Ben Bernanke, the Chairman of the U.S. Federal Reserve Bank, the U.S. economy is under serious pressure and that it will be able to utilize alternative tools in the event that the interest rates drop to zero.
Australia’s central bank cut interest rates by 100 b.p., and as a result the Australian Dollar came under heavy pressure. Investors believe that future interest rate cuts by major central banks are likely to revive their flagging economies.
Shares in the European markets got off shakily, in line with what transpired in Asia and after a huge drop in the U.S. market, as the D.J.I.A. fell by almost 8%.
On December 2, 2008, at 08:54 GMT, the U.S. Dollar fell by 0.4% against the Japanese yen to 92.84 Yen; the Euro also fell by 0.4% against the Japanese yen to 117.25 Yen. The Euro also dropped by 0.4% against the U.S. Dollar, and traded at $1.2575. The Pound Sterling dropped by 0.6% against the U.S. Dollar to $1.4792.