The Japanese currency started this week gaining sharply versus most of the 16 main traded currencies as speculations suggest that a shift in the Japanese government will change regulations toward the national currency, eventually allowing the yen to appreciate, which is improving the Asian currency’s profile this Monday.
Finance Minister Hirohisa Fujii‘s declarations moved the yen rates today after he affirmed that current volatility in the Japanese currency is not excessive, and after the yen climbed severely with the support of his statements, he indicated that his words were misinterpreted, halting the previous rally for the yen. The Democratic Party of Japan, elected this year, was not expecting such a high repercussion for its statements regarding the national currency’s movements and interventions, providing, even if unexpectedly, a sharp rally for the Japanese currency pushing it to the highest level since February versus the U.S. dollar.
The Government of Japan’s position assuring it will not intervene in currency markets and that a weak yen is not necessarily wanted affected Asian equities market and the Japanese currency attractiveness, since the yen gained almost 20 percent versus the greenback last year and traders were concerned about eventual measures to restrict further rallies of the Japanese currency.
USD/JPY traded at 89.38 as of 13:26 GMT after touching 88.21 hours earlier and from an opening rate of 89.65 yesterday. EUR/JPY traded at 130.89 from 131.77.
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