The Japanese Yen has declined beyond 101 per US Dollar following the release of a report that showed that Japanese investors became the net buyers of foreign bonds, snapping the longest selling streak since 2010.
The Yen has fallen against the majority of its peers after the report supported the speculation that the Bank of Japan’s monetary stimulus measures are driving Japanese investors overseas as they search for higher yielding returns.
“Japanese investors buying foreign bonds means they are seeking higher yields abroad as yields in domestic bonds are too low,” said Hiroaki Muto, a senior economist at Sumitomo Mitsui Asset Management in Tokyo. “That’s a sign that Kuroda’s monetary easing and that Prime Minister Shinzo Abe’s policies nicknamed ‘Abenomics’ are working. This also signals further weakening in the Yen.”
The Yen’s rapid decline, (its weakened by more than 20% in the past six-months) has caused other nations to raise complaints over concerns that it will cost their exporters their market share. The weak Yen now means that Japanese exports are significantly cheaper than its rivals with nations such as South Korea saying that the falling Yen is having a significant impact on the nation’s economy. The South Korean Finance Minister Hyun Oh Seok said last month that the weak Yen was more of a threat to the South Korean economy than the threat of nuclear war from the North Koreans.
“With the Yen’s weakness, there’s generally downward pressure on the regional currencies,” said Yuji Kameoka, chief currency strategist at Daiwa Securities Co. in Tokyo. “Intervention is possible in some countries where their currency has been rising.”
Current Japanese Yen (JPY) Exchange Rates
The US Dollar/Japanese Yen Exchange Rate is currently in the region of: 101.353
The Pound Sterling/Japanese Yen Exchange Rate is currently in the region of: 156.4602
The Euro/Japanese Yen Exchange Rate is currently in the region of: 132.0848
The New Zealand Dollar/Japanese Yen Exchange Rate is currently in the region of: 84.6259
The Australian Dollar/Japanese Yen Exchange Rate is currently in the region of: 101.9166
(Correct as if 09:25am GMT)
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