Japanese yen is heading higher again as sentiment shifts toward pessimism and Forex traders look for safe haven. Concerns about what’s next for the global economy, as well as the latest eurozone scare and the US fiscal cliff, are sending high beta currencies lower as safer assets, like the yen, head higher.
Earlier, the yen had fallen, heading lower on Bank of Japan Governor Masaaki Shirakawa‘s promise to aggressively ease monetary policy in the name of economic stimulus. With easing on the way, yen weakened appreciably, dropping as Forex traders turned to higher yielders.
This weakness was short-lived, however, as fears about the state of the global economy returned. European Union leaders are unable to agree on more bailout funds for Greece, so more Greek debt hangs in the balance, even after the country agreed to a new austerity package last week. And, of course, there is still plenty of focus on the fiscal cliff. With a divided Congress in the United States, it’s going to be difficult to come to any arrangement that keeps the fiscal problems at bay.
At 13:55 GMT USD/JPY is down to 79.4800 from the open at 79.4900. EUR/JPY is down to 100.8050 from the open at 101.0350. GBP/JPY is down to 126.1715 from the open at 126.2150.
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