By: Barbara Zigah
With the release of new economic data showing that the American economy’s pace of recovery is slowing, the U.S. Dollar yesterday slipped to its lowest level this year against the Japanese yen. According to the U.S. Commerce Department, the American economy grew only 2.4% (annualized) last quarter, slightly lower than the median of economists’ predictions of 2.6% growth.
As reported at 8:52 a.m. (EST) in New York, the U.S. Dollar traded at 86.09 Yen, a .8% rise from yesterday’s late trade of 86.79 Yen; during Thursday’s session, the U.S. Dollar traded at 85.95 Yen, the lowest trade in nearly 8 months. This month alone, the Yen has appreciated 2.7% against the greenback.
Forex and the JPY
The Japanese Yen is seeing broad gains as higher demand for the safe-haven currency was triggered by a comment made yesterday by James Bullard, the president of the St. Louis branch of the U.S. Federal Reserve Bank.
Mr. Bullard likened the growth of the U.S. economy to that of Japan when he said that the United States is heading toward their type of deflation. Some analysts see Bullard’s comments, coupled with those made by Ben Bernanke, the Fed Chairman, suggesting the possibility of a change in tone from the Federal Reserve.