JPY Daily News

Yen Rallies against the Majors As Risk-Aversion Elevates

The Japanese yen rose against all its major counterparts during yesterday's trading session. The yen gained about 100 pips vs. the U.S. dollar, and about 200 pips against the euro. The EUR/JPY cross fell to an 11-week low as a result. The yen also gained about 80 pips vs. the British pound.

The yen strengthened on Tuesday's trading as risk-aversion surged due to concerns that Europe's sovereign-debt crisis will broaden. It is now pretty clear that the Ireland financial bailout failed to reassure the market and yesterday, Portuguese, Italian and Spanish government bonds declined, signing that investors have concerns regarding the nations' debts. This has increased demand for safe-have assets, and as a result boosted the yen. In addition, speculations that China will take more action to cool its economy have also supported the yen. Analysts estimate that China will have to hike interest rates soon in the attempt to reverse the excessive liquidity in the system.

As for today, traders are advised to follow the updates from Europe regarding the sovereign-debt crisis, as this issue seems to have the largest impact on the market at the moment. Traders are also advised to follow the leading economic releases from the U.S, especially the ADP's Non-Farm Payrolls forecast.

Current Time: 05/27 04:48 GMT

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#	Time	$€£¥	Event	Per.	Prev.	Fore.	Act.	Imp.
12/01
	23:50	JPY	Capital Spending	q/q	-1.7%	6.1%	5.0%
	23:50	JPY	Monetary Base	y/y	6.4%	6.9%	7.6%