JPY Daily News

Yen Declines as the Demand For Save Heaven Currency Diminishes

The Japanese currency inched up against the EUR and the AUD on Wednesday, pulling away from this week's five-month low as a drop in Japanese equities tempered buying of higher-yielding currencies. The yen climbed to 131.39 per EUR from 131.81 late in New York yesterday, when it touched 134.51, the weakest level since Oct 21st. Although the Yen has regained some ground after dropping on Tuesday to a 5-month low against the EUR and a 4-month trough versus the Australian dollar, it is likely to stay on the back foot, analysts have said. The JPY reaction was subdued to data showing Japan's trade balance returned to a surplus in February. The 82.4 billion Yen ($841.6 million) surplus contrasted with economists' forecasts for a deficit of 10.9 billion Yen. The surplus comes after Japan posted its largest deficit ever in January, when exports fell sharply due to a slowdown in the global economy.


The Yen role as a safe haven currency has apparently diminished, and there has been little reason for traders to buy the yen actively. Investors were also reluctant to buy the Yen with the Bank of Japan having raised the amount of government debt it buys outright to thaw credit markets. Instead, investors continue to favor currencies whose central banks have Interest Rates above zero and look unlikely to use quantitative easing to get their economies moving, such as the Australian dollar.

Current Time: 05/27 00:45 GMT

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#	Time	$€£¥	Event	Per.	Prev.	Fore.	Act.	Imp.
03/25
	23:50	JPY	CSPI	y/y	-2.2%	-2.5%	-2.6%