Japanese Yen. (Photo: Bloomberg)
The consequence is stock market Tokyo ended a series of 9 consecutive gaining sessions.
Entering the trading session on March 28, the Yen/USD exchange rate started to break out of the 122 Yen/USD threshold due to the expectation that interest rates between the two economies of Japan and the US would widen in the near future. In the afternoon session, the listed exchange rate surpassed 125 Yen/USD for the first time since August 2015, then fell again.
At 18:00, the buying-selling rate between Yen and USD stopped at 124.68-69 yen/USD, a sharp increase compared to the price of 121.73-75 Yen/USD on this market at 5pm today. before and at the price of 122.05-15 Yen/USD in the New York market.
In the opposite direction, yen increased slightly against the Euro. The buying-selling rate between these two currencies at 6pm on March 28 was 137.02-06 Yen/Euro, slightly down from the price of 134.17-21 Yen/Euro at the end of the previous session.
According to analysts, the main reason for the depreciation of the Yen was because the BoJ made an emergency purchase of Japanese Government bonds (JGB) to prevent the rise of long-term interest rates.
Takuya Kanda, an expert at the Gaitame.com Research Institute, commented: “The BoJ has announced a policy that is opposite to that of the Fed. Investors are stepping up their purchases of the USD as the BoJ is showing a strong commitment to continue. continue to maintain a super-loose monetary policy”.
However, despite the BoJ buying into JGB, the 10-year bond yield is still up 0.015 percentage points from last week’s closing rate of 0.250%, the highest since January 2016.
The strong depreciation of the Yen has had a significant impact on the Japanese stock markets. Ending the trading session on March 28, the Nikkei-225 index fell 205.95 points (equivalent to 0.73%) compared to the closing price of last week to 27,943.89 points. The Tokyo Stock Exchange (TSE) Topix index also fell 8.1 points, or 0.41%, to 1,973.37.
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