The Japanese yen rose today against the major currencies after losing for two days as the U.S. macroeconomic reports will show the worsening of the crisis, according to the analysts expectations, and the investors will cut the amount of assets funded in the Japanese currency.
The yen experienced one of the worst days yesterday as the stocks surged in U.S. on the revealing of the Barack Obamas administrations economic team and the bail-out plan for Citigroup. The demand for the high-yielding assets rose and the yen declined more than any other currency.
The advance report for the third quarter U. S. GDP showed a decline of 0.3 percent almost a month ago. Today, the preliminary report is released and the analysts expect that the decline will be revised to 0.5 percent. The extended contraction of the worlds largest economy will surely hurt the high-yielders and benefit the Japanese yen.
On one hand, the todays growth of the yen may be just a correction, but on the other hand the overoptimism of the last two trading days was probably just predating a deep worsening of the situation and the further yens gains.
USD/JPY dropped from 97.06 to 96.46 as of 8:29 GMT today. EUR/JPY declined from 125.68 to 124.29 and GBP/JPY went down from 147.42 to 145.98.
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