The Japanese Yen slipped to a 4-month trough against its U.S. and European counterparts during Friday’s trading session in Asian as pressure rises against the safe haven currency. An increase in risk appetite and possible additional easing measures being hauled out by the Bank of Japan are all weighing on the Yen. Currency strategists have pointed out that at the present time there appears to be little good reason to use the Yen for carry trade purposes, especially given the BoJ’s commitment to an ultra loose policy.
As reported at 12:11 p.m. (JST) in Tokyo, the EUR/JPY pair edged higher to 136.54 Yen, a level unseen in more than four years, while the USD/JPY touched on a 4-month peak of 101.36 Yen, adding to yesterday’s 1.1% gains. Some analysts believe that the USD/JPY pair could hit on 115.00 Yen over the course of the next year, largely as a result of the Bank of Japan’s convergence in its monetary policy relative to other major central banks, i.e. the Federal Reserve and the European Central Bank.
Aussie Bulls Fear Intervention
The Australian Dollar was also under heavy sell pressure as the head of the Reserve Bank of Australia reportedly said that he would consider intervening in the Aussie Dollar in order to depreciate its strength. The AUD/USD struck a 2-month trough when it hit at $0.9177, before recovering slightly to trade $0.9190, still a loss of 0.5% on the day.