as the yen rose to lead the G7 States in March a joint level of foreign exchange market intervention, dealers expected appreciation of the yen will continue, even though Japan has slipped into recession for the third time in 10 years.
3 months ago, there has been speculation that Japan insurers to withdraw assets abroad to cover the earthquake caused damage caused by the series of disasters, in less than a week, the Yen's appreciation of the time 8.5%. Now, politicians and bankers more concerned is United States economic slowdown, the European sovereign debt crisis and political turmoil in the Middle East problem.
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John Normand of the JPMorgan Chase company said:" more people to come round to the strength of the yen, because they have abandoned the faith of the Fed will tighten monetary policy. Unless the yen renewed sharp fluctuations, otherwise the authorities intervene to interfere is not likely to occur. "
last week, the appreciation of the yen against the dollar by 0.34% per cent to 80.05; appreciation of the yen against the Euro 0.62% per cent 114.52. Analysts on the yen was less pessimistic, partly because of recent appreciation has become slow. According to foreign media investigation said dollar/Yen is expected to end at 86 and after May the predictive value of 88.
the Federal Reserve look forward to the
6 17th, IMF in within two months of the second amendment to the United States economic growth forecasts. IMF says expected United States economic growth this year as 2.5%, per cent in 2012. The value and 2.8% of April is expected to be reduced. IMF will also fall in global growth expected from per cent in April to 4.3%.
traders on the Chicago futures exchange in January had expected the fed to raise overnight interbank lending rates between banks in 2011. And now, traders expect interest rate raise early to late 2012.
are honorific title as "Mr Yen" Aoyama University Professor Eisuke Sakakibara God (EISUKE SAKAKIBARA), "said Bernanke's recent statements show that the Fed will continue its loose monetary policy, which means that interest rates will continue to be low. When you turn to Japan, you will see the many Yen negative factors caused by earthquake, but United States weak economic recovery, are more likely to further appreciation of the yen. "
the ever-increasing demand for Yen
the world's largest FX foreign exchange hedge fund Concepts LLC is expected, as investors concluded that stock and other higher-yielding assets have scene no longer, it will continue to increase demand for Yen. The Fund's founder, John Taylor said, the yen against the dollar in July is expected to grow to 78 in the fourth quarter may reach 75.
according to the commodity futures trading Commission (Commodity Futures Trading Commission) data show that futures traders bet on the appreciation of the yen against the dollar has reached the highest since March. On June 14, the speculative hedge funds and other large institutions holding Yen net long 24,768, most since March 22.
Furthermore, inflation-adjusted 10-year Japan government bond yields higher also make investors more inclined to buy Japan bonds. 10-year Japan bonds real rate of return of 82 basis points, while the United States Treasury real rate of return of only-63 basis points.
the Japan economy
if the weakness of the yen, the appearance of help to Japan Prime Minister Naoto led Japan economy out of recession, from this point, the current situation in the negative. Japan House province said on June 9 in the first quarter from Japan GDP contract by 3.5%. Toyota and Honda are two major companies have said that, due to the impact of the strong yen and the great earthquake, its profits will be reduced. These two major auto manufacturers have said, it may move production to foreign countries.
according to Baring Asset Management (Baring Asset Management) Alan Wilde said Japan deteriorated financial situation or to limit Yen appreciation. Japan debt is twice times the scale of its economy, which is most in developed countries, and Moody's ratings on May 31, also said its Aa2 credit rating will likely be reduced.
Wilde said: "I puzzled for the strength of the yen, because its fundamental view, whether credit rating also prospects for economic growth are not particularly stronger than any developed country. "
strong depressing exports of the yen, the first quarter of 2011 Japan total net export share of GDP has decreased by 0.2%.
