In recent weeks the Japanese yen has pushed its way up and above the expectations of many forex traders at trading sites such as CMC Markets and eToro. But the unexpected and continuing strength of the Yen is causing concern for the Japanese Government. In a statement made on Wednesday by the Japanese Prime Minister, Yukio Hatoyama, he said that the continuing strength of the yen “can’t be left as it is”, prompting speculation that Japan may take measures to undermine the yen’s strength.
For months many foreign exchange traders have profited by the continuing climb of the yen against many pairs. But due to the threat of deflation the Bank of Japan may call in the assistance of Japan’s Ministry of Finance to intervene in the currency markets for the first time since 2004 in the hope of resisting an economic downturn.
The US dollar has been in somewhat disarray since the US treasury release it’s worse than expected GDP predictions on Tuesday. Forex traders at trading sites such as Forexyard who have been wise to this trend will have also noticed just how poorly the dollar (UDS) has been performing against the Japanese yen (JPY) and just how much profit there has been, a seemingly will continue to be. The US dollar has Fallen To a 14-Year Low Against The Yen and despite early morning resurgences the strength of the dollar against the yen continues to freefall.
The last time that the dollar performed so badly against the yen was all the way back in 1995. The yen itself is powerless in its meteoric rise as the price is being driven up by the dollar selling as opposed to the yen buying. There are a number of reasons for the poor performance of the dollar over recent weeks. One of the main reasons is the continuing low interest rates on the other side of the Atlantic but the US Government seem unconcerned about the dollar’s decline and say they won’t provide intervention to halt the slide.
