The Japanese yen continues to slide as Forex traders expect more easing from the Bank of Japan. Comments from a political leader in Japan indicate that an aggressive policy of easing will be followed starting next month, and that has Forex traders already seeing increased weakness.
Shinzo Abe, the leader of the LDP, made a speech earlier, outlining campaign promises and talking about what will happen if his party comes into power after the December general elections. Abe has laid out specific targets, including 2 per cent inflation and 3 per cent nominal economic growth.
In order to achieve this, the Bank of Japan is expected to engage in an aggressive program of easing. Such a program would further weaken the Japanese yen. Indeed, the expectation of further easing is already sending the yen lower against its major counterparts. Japanese leaders have always preferred a weaker yen, but the recent easing has emphasized that leaders will do what it takes to kickstart the economy, and Abe has outlined a plan to use easing in a way that is even more aggressive.
At 15:01 GMT USD/JPY is up to 82.3900 from the open at 81.6750. EUR/JPY is up to 105.3125 from the open at 104.7050. GBP/JPY is up to 131.2650 from the open at 130.0850.
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