Connect with us

Currencies

Japan Election Speculation Makes Yen Bears Happy

Japan will hold a Lower House election on December 16 in which the ruling Democratic Party of Japan (DPJ) is widely expected to lose to the opposition Liberal Democratic Party (LDP). The LDP is headed by Shinzo Abe, a former prime minister, who has called for “unlimited easing” by the Bank of Japan to create inflation and to weaken the yen.

Avatar

Published

on

Japan will hold a Lower House election on December 16 in which the ruling Democratic Party of Japan (DPJ) is widely expected to lose to the opposition Liberal Democratic Party (LDP). The LDP is headed by Shinzo Abe, a former prime minister, who has called for “unlimited easing” by the Bank of Japan to create inflation and to weaken the yen.

Hedge fund traders we have spoken to interpret “unlimited easing” to mean specific inflation targets for the Japanese central bank and unlimited intervention in the foreign exchange market.

Japan Yen

The LDP  headed by Shinzo Abe, a former prime minister, who has called for “unlimited easing” by the Bank of Japan to create inflation and to weaken the yen, could win the December election.

 

Once it became clear on Thursday of last week the prime minister Noda was going to dissolve the Diet and call an election, the Nikkei 225, Japan’s benchmark stock index, has rallied while, in the currency market, the yen has weakened against the U.S. dollar, further fueling the rally in equities

Over the weekend, Goldman Sachs Asset Management chairman, Jim O’Neill, publicly reversed his call on the yen.

“From the Plaza Accord of September 1985 all the way until I joined GS in the Autumn of 1995, I was bullish Yen, and after a brief shift to being temporarily US$ bullish, I returned to being a Yen bull from 1997 until a few years ago,”

O’Neill wrote. ”I was quite chuffed with myself for understanding the Yen and it was based on pretty simple stuff, Japan’s persistent and strong balance of payments, especially its trade and current account surplus, and its associated rising equilibrium exchange rate.”

via Japan Election Speculation Makes Yen Bears Happy | Benzinga.

Comments

Banking

Fitch confirms Thailand’s rating at ‘BBB+’ with a Stable Outlook

Thailand’s ratings are supported by strong public and external finances, which have provided buffers to respond to the economic shock and market volatility associated with the coronavirus pandemic.

Bahar Karaman

Published

on

Fitch Ratings – Hong Kong – 29 Oct 2020: Fitch Ratings has affirmed Thailand’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘BBB+’ with a Stable Outlook.

(more…)
Continue Reading

Currencies

Asian currencies slip as U.S. jobs data bolsters dollar

Reuters

Published

on

By

Asian currencies faltered on Monday, as a rebound in U.S. payrolls data supported the greenback, offsetting optimism of a Sino-U.S. trade deal and further China policy stimulus.

(more…)
Continue Reading

Currencies

Most Asian currencies rise as trade war reports boost risk appetites

The Thai baht was largely flat against the dollar

Reuters

Published

on

By

Most Asian currencies firmed on Wednesday as reports of headway in Sino-U.S. trade talks and easing U.S. bond yields prompted buying of regional risk assets.

(more…)
Continue Reading

Latest

Most Viewed

Subscribe via Email

Enter your email address to subscribe and receive notifications of new posts by email.

Join 13,609 other subscribers

Trending