JPY Daily News

Yen to Rise Further Due to Government Insufficiency

The Japanese Yen may rise further through the end of the country's fiscal year on March 31, as exporters buy the currency to hedge revenues, and money managers bring funds home amid the global slump. Analysts forecast that the market should expect even further Yen appreciation as the Japanese fiscal year comes to a close, as both corporate hedging and investor repatriation flows support the currency. The Japanese currency closed at 89.34 per Dollar from $89.68 yesterday. The Yen has gained 1% against the greenback this month, following a 23% rally last year. The JPY may continue to strengthen as investors unwind so-called carry trades, where they borrowed in the currency to invest in nations where benchmark Interest Rates exceeds Japan's 0.1%.

Recently, some important market players have called for more aggressive government measures to halt the Yen's rise. It's important to note that the strong Yen has significantly hits exporters profits. Even though the world is currently in a deep recession, it seems the Japanese government's policies are totally insufficient, according to many leading industrial leaders. Japan's Finance Ministry is unlikely to shield the country's exporters from a rising currency by ordering the Bank of Japan to intervene and sell the Yen. Some analysts predict that the structural Yen appreciation has yet to run its course as there remains scope for investors to unwind more carry trades, and they believe that JPY will appreciate further versus the USD, possibly to the 84 Yen within 3 months.

Current Time: 05/27 05:36 GMT

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#	Time	$€£¥	Event	Per.	Prev.	Fore.	Act.	Imp.
01/30
	05:00	JPY	Housing Starts	y/y	0.0%	-7.6%	-5.8%