Large-scale strengthening of the yen - rise or fall?
Throughout his history of the Japanese yen (JPY) has come a long and difficult path. After the war, the course of the yen against the dollar was defined by the U.S. administration and amounted to 360 yen per dollar. In the period from 1995 to 1998 the level of the yen experienced a rise and decline, and the newly strengthened at 80 yen to the dollar until the end of 1998. For the current, 2010, the euro fell by 9.1%, the dollar has appreciated by 3.8%, while the yen rose by 15%, which is the best indicator of rates of all developed countries - such data agency Bloomberg. So what lies behind such a significant appreciation of the yen? Let's try to understand.
All investors were waiting, a Bank of Japan intends to restrain the growth rate of its currency. According to the Prime Minister Naoto Kan, he feels a "sense of crisis" about the issue, but no specific instructions for solving problems with a strong currency from the Prime Minister has been reported.
Experts believe that the Bank of Japan should make a decision now or wait for the results of the annual economic symposium, which runs in Kansas City, USA.
Concerned about the increase in the yen and Japanese corporations, which receive the bulk of profits abroad. Thus, the leadership of Suzuki Motor Corp and Sony Corp, said that their losses are very large. Loss of Sony Corp, for example, already amounted to about 2 billion yen, or $ 23.6 million
The idea is that the Japanese government should provide relief to convince the Central Bank monetary policy, so as not to cause major upheavals in the economy of the country. But there is a possibility that the yen to stop the growth and stabilization of the index Nikkei, Japan may conduct foreign exchange intervention on the forex.
Not to say, the Japanese currency benefited some benefit from the situation. After all, in order to reduce the level of risk, many investors get rid of higher-yielding currencies, making the Japanese yen has gained considerable weight in the global market. But with the massive consolidation of the yen by the Japanese government can not cope, it needs strong assistants, who, unfortunately, very busy with other global problems ...
Xenia Minor
