The drop in JPY could be a reaction to the fear of a Japanese debt crisis. As noted in a recent Financial Times article: "The ratio of Japan’s gross government debt to GDP has breached two hundred per cent. A Godzilla-sized rollover of Y210,000bn – equivalent to the entire public debt of Italy – will take place over the next twelve months. Challenging arithmetic, to say the least".
Pundits' prediction of a looming Japanese debt crisis have already set off brief spasms of selling in Japan's government bonds. In January, Standard & Poor's warned that it might downgrade the country's sovereign debt rating to levels below those of Chile. In February, Moody's also threatened to cut its view on Japan if the country fails to put together a convincing plan for debt reduction.
Can JPY survive the current selloff? We will have to wait & see.
Chart: JPY's daily chart as at Apr 6, 2010 (Source: Stockcharts.com)
3 comments:
hi alex. all banking stocks rise alots and keep breaking record high. i saw BIMB rise no much, can buy this BIMB?
Hi Wong,
Indeed, BIMB has bropen to the upside of "descending triangle" at RM1.30-31 on April 2. Its immediate resistance is at RM1.40 & then the high of RM1.50 recorded in November last year.
hi alex,
indeed Yen is heading south. target is 9993.
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