Global capital markets picked up today right where they left off last week, sliding downward with no end in sight. A general aversion to risk is driving the markets, as investors pile out of equities and into bonds. Also benefiting from the global sell-off is the Japanese Yen, as nervous investors move to cover their carry positions built up over the last year by buying Yen. It remains to be seen whether the Yen will continue its upward move after the current frenzy subsides, since it may just as well be a temporary increase in volatility that is driving the Yen rather than a long-term correction. Once the markets cool, it is possible that complacent investors will move once again to build up their Yen short positions. Forbes reports:

Now, locked in a reverse vicious cycle, the rapid unwinding of carry trades has applied upward pressure on the yen, compelling other investors to reduce positions on carry trades and enticing speculative currency traders to buy yen.

Read More: Investors Adjust to the Yen’s Surge