Yen drops to 30 month low against dollar, euro

Posted On: January 31, 2013

The monetary unit of Japan dove to its 30-month trough against two key rival currencies on Friday as speculation mounted about the selection of a central bank chief who will continue implementing the new prime minister's monetary stimulus policies, according to Bloomberg.

The Japanese yen sank against the U.S. dollar and the shared currency of the European Union, marking its 12th-straight weekly loss to the greenback. Prime Minister Shinzo Abe is tasked with tapping a new Bank of Japan president and his two deputies, which is scheduled to occur during the next three months.

Speculation about a new central bank chief "is the number-one source of the move we have seen in the yen," global head of foreign-exchange strategy Peter Frank with Banco Bilbao Vizcaya Argentaria in London told the news source on Friday. "Because you are having that at the same time as strong equities, strong risk-on news flow generally, the yen is doubly weak."

Since taking office as prime minister in late December of last year, and while campaigning for the top job, Abe has encouraged stimulus as a way of spurring the globe's third-largest economy.

Reuters reports analysts anticipate foreign exchange markets will see the yen continue to weaken in the near term.
 

Category: Industry News

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