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Yen Recoups Some Losses, Sterling Firms

Posted by Chris Advincula on Jul 13, 2016 12:00:31 AM

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(July 12 Reuters) The yen clawed back some of this week's losses in Asian trading on Wednesday, after it sank to 2 1/2 week lows reached this week as the prospects for more economic stimulus in Japan helped bolster risk sentiment.

The dollar slipped 0.5 percent to 104.20 yen. On Tuesday, the greenback scaled a peak of 104.98 yen, its highest level since June 24. For the week, the dollar was still up about 3.6 percent against the yen.

The euro fell 0.5 percent to 115.26 yen EURJPY but was still up about 3.7 percent so far this week.

"There has been some profit-taking by people who were yen-short, and that led the yen to rise today," said Ayako Sera, market economist at Sumitomo Mitsui Trust Bank in Tokyo.

Part of the yen's rece3nt weakness was also due to some investors' hopes that former U.S. Federal Reserve chair Ben Bernanke's meetings with Japanese leaders this week would herald the adoption of a "helicopter money" stimulus policy.

That term, coined by American economist Milton Friedman, was cited by Bernanke before he became Fed chairman in 2006, when talking about how central banks might finance government budgets as a way to fight deflation.

"Some investors were also hoping that 'helicopter money' was coming to Japan, but the chief cabinet secretary just explicitly said that was not going to happen, and the dollar came off," Sera said.

Click on the link below to see the full story from Reuters: (by Lisa Twaronite and Masayuki Kitano)

Yen recoups some losses, sterling firms

 

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Topics: $USDJPY, GBPUSD, EURO, Japan, Forex, Japanese Yen

 

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