The Japanese Yen slid to its lowest-level in eight weeks against the US Dollar and weakened against many of its most traded peers as the gap between Japanese and US bonds widened by its biggest margin in two years.
Increasing speculation that the US Federal Reserve could start to taper its $85 billion per month quantitative easing programme as soon as December strengthened the US Dollar at the expense of its peers whilst the bond news weakened demand for the safe haven Yen.
The Japanese yen was also weakened against most of its major peers, as demand for safe havens was dimmed after the MSCI Asia Pacific Index of shares climbed by 0.5%, marking a second-day-in-a-row advance.
The weakening of the Yen is good news for Japan as it increases demand for exports. As the Yen weakened the Japanese Nikkei Index surged higher by 2.2%.
“The recent decline opened up room for bargain-hunting, but thin trading volume underscores investors search for clues on the timeline for the Fed’s stimulus cutback,” said Lim Dong-rak, an analyst based in Seoul.
The Yen was also weakened by the result of a consumer confidence survey. 6,720 households across Japan were surveyed to get a sense of consumer confidence in the national economy. The report showed that consumer confidence fell to a reading of 41.2 in October, down from the 45.4 in September.
The next major data release for the Japanese Yen comes on Wednesday when the latest GDP growth figures are published.
Current Japanese Yen (JPY) Exchange Rates:
The US Dollar/Japanese Yen Exchange Rate is currently in the region of: 99.6840
The Pound Sterling/Japanese Yen Exchange Rate is currently in the region of: 158.6810
The Euro/Japanese Yen Exchange Rate is currently in the region of: 133.2770
The New Zealand Dollar/Japanese Yen Exchange Rate is currently in the region of: 81.9562
The Australian Dollar/Japanese Yen Exchange Rate is currently in the region of: 92.9474
(Correct as of 09:35 am GMT)