Last week, Japanese leaders intervened in an effort to help keep the yen weak. However, the maneuver didn’t go off as well as expected, thanks to demand for Japanese assets from China. And, today, yen is strengthening again as a safe haven.
Indeed, yen is gaining against most major currencies right now, heading higher against other currencies, especially those in Europe, as concerns about stability in the eurozone continue. Even there is some relief over Greece, worry has shifted to Italy. No one knows what will happen next, and it doesn’t appear that eurozone leaders have a solid plan for containing sovereign debt throughout Europe.
As a result, Forex traders are turning to safe havens, and that includes the Japanese yen. So, it doesn’t matter that Japanese leaders attempted to weaken the yen last week. The currency is still in demand. And, of course, finance minister Jun Azumi is finding himself tested: Is he really that committed to a weaker yen? Is he willing to intervene again in an effort to depress the yen’s performance on the Forex market? We are likely to find out soon.
At 14:00 GMT, USD/JPY is lower at 78.06, down from the open at 78.15. EUR/JPY is lower at 107.25, down from the open at 107.72. GBP/JPY is down to 125.09 from the open at 125.19, and AUD/JPY is lower at 80.70, down from the open at 81.16.
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