Japanese yen is gaining today, heading higher as Forex traders show caution. Concerns about what’s next for the eurozone are once again front and center in the markets. Yen is gaining as Forex traders reduce their riskier positions in favor of a more measured approach to the situation.
Once again, the more cautious Forex traders are turning to the yen because of its stability. Yen is considered a safe haven, and with a bit of uncertainty considering Mario Draghi‘s intentions, many are turning to the yen. US monetary policy is also playing a role in the yen’s strength.
With Japanese leaders and the Bank of Japan not quite ready to engage more economic stimulus, Forex traders are looking to what’s next for the United States. Many expect the Federal Reserve to introduce more easing, and that would weaken the US dollar against its counterparts — including the yen.
As yen strength improves, however, it is likely that the Japanese leaders will take steps to intervene. A strong yen works against the Japanese desire to have an edge with exports. As a result, Japan is not usually afraid to step in and intentionally weaken the yen.
At 14:00 GMT USD/JPY is down to 78.4580 from the open at 78.6060. EUR/JPY is down to 96.8095 from the open at 97.4650. GBP/JPY is down to 122.7470 from the open at 122.7850.
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