The Japanese yen, after heading higher yesterday on risk aversion, is pulling back against major counterparts as a bit of risk appetite shows in Forex trading.
Yesterday, Japanese yen surged on safe haven demand as eurozone troubles continued to mount. Today, though, with the ECB buying up Italian bonds in an effort to prevent disaster, and somewhat encouraging economic data coming from the US, risk appetite is making an appearance.
As a result, the yen is lower in Forex trading. This latest development should ease some of the fears held by Japanese leaders with regard to export trouble linked to a higher yen. Indeed, there had been some fears that it would be hard for carmakers in Japan to get back on track with a higher yen spoiling export demand. That concern has not disappeared, but things look a little more hopeful right now.
And, of course, Japanese leaders have shown themselves perfectly willing to intervene when they feel it necessary. If the yen begins to strengthen too much, too quickly, Japanese financial leaders, including Jun Azumi, would be quick to make an attempt to keep the yen weak. But, for now, there is no need to intervene.
At 14:43 GMT, USD/JPY is a little lower, heading down to 77.7099 from the open at 77.8950. EUR/JPY is higher, at 105.6920, up from the open at 105.3850. GBP/JPY is also higher at 123.9275, up from the open at 123.8550.
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