Despite the Japanese government’s repeated warnings that they might intervene to defend the local currency and halt its drop, the yen plummeted against the dollar.
The yen is decreasing by more than 1% to 151.95 yen per dollar, which is the lowest level in 32 years, according to the Bloomberg News Agency. The high return on American bonds, however, has helped to strengthen the strength of the green currency.
Bloomberg further stated that once the yen’s value dipped to above 150 yen to the dollar, pressure on the Japanese government mounted.
The market anticipates the movement of Japanese officials and their intervention to support the local currency at any time, according to Brad Pecit, head of the exchange markets sector at Jeffrez Financial Consulting Corporation, and “there will be many who will benefit from the decline if it happens.”
This occurs as Sonchi Suzuki, Japan’s minister of finance, confirmed today, Friday, that his country is prepared to act. Sonchi Suzuki stated that he is watching the markets with a severe sense of the seriousness of the situation and that this sudden and unacceptable decline of the yen is unacceptable.
It is interesting to observe that the dollar is strengthening against the majority of the world’s top ten currencies at a time when US Treasury Bonds are losing value and earning higher returns, with the return on the benchmark decades at its best levels since 2007.
Monetary policy makers in the Federal Reserve (Central Bank) indicate indicates that the Central Bank indicates The American to their intention to continue to increase the main interest rates in order to ensure that inflation is under control in various markets of the world. For the first time since 2011, the yield on the typical German ten-year bond has risen to more over 2.5%.
Despite predictions of Japanese involvement to stabilize the domestic currency, the yen keeps falling against the dollar.
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