Market News

Today in early Tokyo trading, the Japanese Yen and the U.S. Dollar fell broadly as stock markets in the region rose on hopes that the U.S. government is planning to subsidize mortgages in the U.S. and as investors prepare for the G-7 finance officials meeting, currently being held in Rome.

The U.S. Dollar and Japanese Yen rose today as investors felt comfortable with the perceived safety of both currencies as stocks fell, prompted by concerns about the effectiveness of government policies to curb recession and rescue the ailing banks.

The Pound Sterling lost ground versus other major currencies in London trading today following the release of a report issued by the Bank of England which opened the door for additional monetary easing. The quarterly Inflation Report revealed that the Bank of England is predicting a sharp pull back on inflation, below the set target. One Bank of England official suggested that additional easing of liquidity may become necessary. That statement sent short Sterling rate futures markedly higher and the Pound Sterling lower as forex markets scurried to set prices within the relaxed monetary policy.

The U.S. Dollar lost ground versus the Yen in early morning trading in Tokyo today in cautious trading just prior to the release of key jobs data which is expected to portray a more dismal snapshot of the U.S. jobs market than had been originally expected. The U.S. Dollar touched on a 1-month high versus the Yen yesterday, on U.S. shares which rallied in the hope that the Federal government’s bank rescue plan will include the deferral of an important accounting rule; the suspension of which will likely thaw investors’ risk aversion.

On February 4, 2009 at Tokyo, the U.S. Dollar and the Japanese Yen saw some gains again, with investors anticipating a brighter market sentiment driven by stronger than expected housing data for the United States that had been released the previous day, which allowed caution to trickle back in.

The U.S. Dollar and Japanese Yen both lost ground in early London trading today following movements by the government of Australia to further stimulate their flagging economy with a key interest rate cut and the unveiling of a new stimulus package, and the Bank of Japan’s recently announced scheme to buy shares. Australia’s Reserve Bank reduced the key cash rate by 1%, to a new low of 3.25; this move was widely expected, however

The Japanese Yen saw some gains versus other major currencies in early trading today in Tokyo, after the release of less than favorable economic data from the Euro Zone and the United States raised fears of investors of the strong possibility of a longer than expected economic recession. As a result, investors shied away from high yielding currencies including the New Zealand and Australian Dollars, and turned toward the safe haven Japanese Yen.

The Pound Sterling lost ground today against the U.S. Dollar, as continued losses in the equity markets heightened risk aversion, and helped prop up the greenback. However, the Pound was able to gain an edge on the Euro, coming close to 90 Pence, which was the highest price in 11 days.

On January 29, 2009 in Tokyo trading, the U.S. Dollar dipped slightly against the Japanese Yen, after rising yesterday due to a surge in U.S. shares as the Federal Reserve did not commit itself to purchase longer term Treasuries. Yesterday, the Federal Reserve maintained interest rates near zero after a two-day meeting, although it was announced that they were prepared to acquire longer dated Treasury debt, if it was perceived that that would improve the liquidity crisis.

On January 28, 2009, in Tokyo, the U.S. Dollar edged up versus the Japanese Yen as an enhanced appetite for risk encouraged investors to move out of the safe-haven Yen. Meanwhile the U.S. Dollar dipped against the Euro as investors awaited the outcome the meeting at the Federal Reserve bank, which will be concluded later today and will reveal the steps being taken by the Fed to ease the credit crunch. The benchmark interest rate in the United States is almost near zero, investors are looking for additional policy measures, such as the acquisition of long-dated Treasuries.

On January 27, 2009 in Tokyo, the Japanese Yen dropped against the Euro and the Pound Sterling as Tokyo shares surged following the Japanese government’s confirmation of a plan to inject more capital into the banking system, which is expected to assist companies hurt by the global financial crisis. The Japanese government’s plan is to initiate a $16.7 billion proposal to acquire shares in troubled companies.

On January 26, 2009 in Tokyo, the U.S. Dollar climbed, closing in on a near quarter century high against the Pound Sterling and a 6-week high against the Euro, as worries about the worldwide recession and financial sector difficulties prompted investors to stay away from risky assets.

On January 23, 2009 in early trading in Tokyo, the Japanese Yen held firm versus major currencies on lingering worries and economic fears over the global financial sectors. Trade was restrained and investors appeared to be adjusting their positions given the fact that there are few major economic events in advance of this weekend and next week’s New Year’s holiday in China.

On January 21, 2009 in early trading in Tokyo, the Pound Sterling and the Euro gained slightly, recuperating from earlier losses as investors soften somewhat on risk aversion. But market worries persisted over huge losses in the banking sector in the U.K. and the protracted Euro Zone recession, which limited the rebound of the Pound Sterling and the Euro.

Today, January 20, 2009 in early Tokyo trading, the U.S. Dollar gained versus a basket of currencies as the Pound Sterling extended losses to a 7-year low against the U.S. Dollar, following the announcement by the Royal Bank of Scotland of the largest loss in the U.K.’s corporate history and also investors’ renewed concerns about the global financial sector.