Why do l care, says the Yen
Skerdian Meta • 1 min read
The Japanese Yen has been on a roll this year. It has gained thousands of pips against most major currencies and I don´t even want to mention GBP/JPY. The risk aversion has been the story so far this year. First, it was the decline in the oil prices then came the global financial market scare now it is Brexit.
So, the Yen which is a safe haven becomes the main beneficiary in such times. Today is a good example of how the risk aversion sentiment is driving everything, nothing else matters, not fundamentals, not central bankers and definitely not the technical indicators.
EUR/JPY has lost nearly 200 pips since last night
Satoshi Fujii is the financial advisor of the Japanese prime minister Shinzo Abe and this morning he suggested that abe should inject 20 trillion Yen into the economy this year and about 37 trillion in the next three years in order to reach the inflation target. He also supported the negative interest rates. In normal times this would have sent the Yen tumbling hundreds of pips down but not right now. The Yen has gained more about 200 pips across the board.