Yen Climbs After Another Earthquake, Rates Stays Unchanged

The Japanese yen rose today on the speculation that demand from investors will shift to safe currencies from higher-yielding ones after Japan was hit by another earthquake.

Today Japan experienced yet another earthquake. The 7.1-magnitude tremor is the strongest since the earthquake on March 11 and caused the tsunami warning. Tokyo Electric Power Co. reported that the new earthquake hasn’t influenced the Fukushima nuclear power plant that was damaged by the previous earthquake. Still, this quake can switch mood among investors to risk aversion mode.

The Bank of Japan decided today to keep the overnight call rate at around zero to 0.1 percent. This move was expected by market participants, but it doesn’t help Japan’s currency anyway.

USD/JPY traded at 85.01 today as of 22:02 GMT after it earlier dropped from 85.48 to 84.59. EUR/JPY fell from 122.51 to 121.61, while GBP/JPY declined from 139.58 to 138.73.

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