Yen Falls to 24 Year Low – 8 September, 2022

The steady decline in the Japanese yen has left many big investors spooked, with some cutting bets that the currency will decline further and anticipating policymakers may soon step in to try and arrest the free-fall. The currency fell to a 24 year low on Wednesday, losing roughly 30% since the beginning of last year as U.S. interest rate expectations have gone up and Japanese rates have gone nowhere. With no particular trigger, the yens 3% fall this week was enough for some funds to call time on the first leg of their wager that Japan would have to quit its policy of capping bond yields as its global peers push rates higher. The yen has not been alone in sliding lately as the U.S. dollar has zoomed to multi-decade highs on the euro and sterling on a combination of risk aversion and interest rate expectations. The euro was up 0.52% at $1.0050, inching away from its two-decade trough of $0.9864 hit earlier in the week. The single currency is on track for a 0.9% weekly gain, snapping three straight weeks of decline, but has nonetheless fallen more than 10% this year. Meanwhile, sterling was last up 0.43% to $1.1547, reversing its losses from the previous session. The U.S. dollar index was down 0.25% to 109.25, just off a 20-year top of 110.79. Against the Japanese yen , the dollar was last down 0.29% to 143.69, but is up nearly 3% on the week, the largest weekly gain since June. The Aussie was up 0.55% to $0.6788, while the kiwi was up 0.47% to $0.6084, though both currencies were on track for weekly losses.