The Yen has Performed Remarkably Well Recently. Why?

KOTO-KU, Japan - April 22, 2016 - PRLog -- The Yen has Performed Remarkably Well Recently. Why?

This week, the Japanese currency surprised money managers when it reached an all-time high. According to experts, this surge can be best attributed to the changes in the bond market.

Given the fluctuations in the Japanese economy, the authorities had not expected such a rise in the Yen. However, the currency astonished some when it showed a gush of about 3% against the dollar this week. This has been the Yen's most noticeable and substantial surge since February. What's more surprising is the fact that this surge came at a time when the country's bond yields are negative for most maturities. In the past, negative bond yields had been the key factor responsible for dwindling interests in the Japanese currency.

However, the banks have been pointing to a decrease in inflation as the prime factor that could have led to such an unexpected rise in the Yen. They have been studying different metrics to pinpoint various factors that could have caused the Yen to perform so well. It's believed that another factor that could have led to this change is the decrease in United States real yields in the recent past. The banks have now predicted that by the end of September, the dollar could drop further down to 105 Yen.

According to Michael Lane, the Global Co-Head of the Investment Management Division of Shizuoka Capital Wealth Management based in Tokyo, who manages $2bn of institutional investors' assets, "When we take into account the decreasing inflation, it becomes easier to overlook the 10-year Japanese Debt which the United States holds over the country."

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About Shizuoka Capital Wealth Management

The company is engaged in wealth management services such as securities, the buying and selling of corporate debt, handling mergers and acquisitions, private equity and fixed income. It was founded in 2006 with Headquarters in Tokyo, Japan. As of 2015 the company assets were in the region of $6bn.

Miyuki Natsuko

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