Forex Blog: Currency Trading News & Analysis.

February 27th 2006

Japanese Yen benefits from rate hike rumors

According to a variety of economic indicators, Japan is now the fastest growing economy in the G8 Industrialized countries. Further, it seems Japan has definitively succeeded in ending a decade-long deflationary spiral, during which its nominal GDP declined. Japanese economists have hinted that the Bank of Japan may soon end its ultra-loose monetary policy. This move, which will take the form of higher interest rates, has even received the support of Japanese politicians, who previously seemed ambivalent. While the rate hikes will not occur for a couple of months, currency traders are already beginning to buy Yen based on the prospect of a narrowing interest rate differential between Japan and the rest of the developed world.

Read More: Policy hope propels yen’s rally

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© 2004 - 2018 Forex Currency charts © their sources. While we aim to analyze and try to forceast the forex markets, none of what we publish should be taken as personalized investment advice. Forex exchange rates depend on many factors like monetary policy, currency inflation, and geo-political risks that may not be forseen. Forex trading & investing involves a significant risk of loss.