The yen entered its eleventh day of losses versus most of the 16 main traded currencies as a rally in Asian stocks suggests that evidences indicating the end of the global slump are pushing investors to riskier assets, damping demand regionally for the Japanese currency.
A report to be released in the U.S. is leading positive speculations today, as new home sales are expected to rise significantly according to economists, pushing traders to high-yielding positions in the South Pacific region and damping demand for the yen. In Asia, the South Korean won led the gains as stocks rose, followed by the Indian rupiah. Adding to the negative scenario based on fundamental factors that depreciated the yen, a significant number of carry trades were resumed as foreign-exchange volatility is expected to fall.
In Japan, currency strategists affirm that the improving conditions and speculations leading traders to believe that the economic recovery is finally on its way brought traders to invest massively in stock markets, mainly considering the low-yielding condition that most of currencies are submitted to now, near to zero in both Japan and the United States. Specialists also affirm that the currencies due to lose the most with as optimism improve are the greenback and the yen, and oddly enough, positive news coming from the U.S. are a negative factor for the dollar at the moment.
EUR/JPY traded at 135.56 as of 10:43 GMT after being traded at 134.50 in the beginning of this weekly session. AUD/JPY traded at 78.20 from 77.40.
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