Reported 9 months ago
The rapid depreciation of the Japanese Yen, approaching 165, may trigger a new financial storm, as the USD to JPY exchange rate broke a 38-year high reaching 160.87. FXTM warns that if the yen depreciates further to 165 or 170 and the Bank of Japan fails to fundamentally change its policy, it could lead to a major economic crisis within Japan. Market concerns also stem from the anticipation of a rate hike by the Bank of Japan in July, with the possibility of a continued devaluation of the yen. The spread between US and Japan interest rates remains wide, driving market sentiment to short the yen. The future trajectory of the yen hinges on the Bank of Japan's policy adjustments as any intervention may only have short-term effects. If the yen further depreciates to 165 or 170, the Japanese economy's ability to withstand such devaluation will pose a significant risk.
Source: YAHOO