Disappointing global economic data and fears of Eurozone contraction push investors towards the safe-haven Yen.
The Japanese Yen Exchange Rate was in the region of 0.0107 against the US Dollar as of 09:55 am
With demand for safe-haven assets boosted by European political concerns, disappointing Chinese Services PMI and the expectation that this week’s Eurozone GDP data will reveal that the 17 nation currency bloc contracted, the Yen advanced on all of its most traded currency rivals.
The Yen was able to strengthen against currencies including the Euro and US Dollar despite the nominee for the post of governor of the Bank of Japan vowing to instigate additional monetary easing in order to combat inflation.
Nominee Haruhiko Kuroda has the support of the Japanese Prime Minister, and during his recent address to parliament asserted that he was prepared to bring forward open-ended asset purchases from 2014 in an effort to end persistent deflation. He stated: ‘I would like to make my stance clear that we will do whatever we can do.’
If Wednesday’s Eurozone GDP figures meet expectations and show a drop of 0.6 per cent in the last quarter of 2012 – and if uncertainty persists regarding the political situation in Italy – the Yen could be additionally bolstered.
One industry expert described the present state of affairs in the Eurozone in the following terms; ‘What Europe is faced with is growth numbers that aren’t attractive, unemployment that’s getting worse and the Italian situation which remains unclear. The market really hasn’t got many reasons to turn the weakness in euro around at the moment.’
Although the Yen has depreciated by 17 per cent in the past six months, the safe-haven currency is still a more attractive option for investors than the volatile Euro.
As currency strategist Jim Vrondas comments: ‘The risk-off environment and uncertainties about Europe permeating the market at the moment are adding to demand for the Yen. Traders are being squeezed out of positions betting on Yen declines, and we think this Yen strength has longer to run as they continue to unwind positions.’
Current JPY Exchange Rates
The Japanese Yen to Pound Sterling (JPY/GBP) exchange rate is trading at 0.0071
The Pound Sterling to Japanese Yen (GBP/ JPY) exchange rate is trading at 140.9000
The Japanese Yen to Euro (JPY/EUR) exchange rate is trading at 0.0082
The Euro to Japanese Yen (EUR/ JPY) exchange rate is trading at 121.7590
The Japanese Yen to US Dollar (JPY/USD) exchange rate is trading at 0.0107
The US Dollar to Japanese Yen (USD/JPY) exchange rate is trading at 93.6100
These exchange rates were correct as of 09:55 am
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