The yen slumped to a five-month low against the US dollar in European morning trade on Monday, shrugging off an apparently concerted attempt by central bankers to talk up the ailing Japanese currency.
Jean-Claude Trichet, the president of the European Central Bank, said in the aftermath of a G7 meeting in Singapore at the weekend that: “We noted that [Japan] had exited its zero rate policy, that its recovery is now broad based.
We agreed that the yen will reflect these developments.” Sadakazu Tanigaki, the Japanese finance minister, also argued that the value of the yen should reflect Japan’s recovering economy, adding that the recent fall in the currency had been a “little rough”.
The yen has tumbled 6.1 per cent against the euro since mid-May, hitting an all-time low against the single currency on 16 separate occasions.
However, after an initial jump higher when trading re-opened, the yen more than surrendered these gains to sit weaker than on Friday.
The yen initially spiked to Y148.10 against the euro, but fell back to Y149.59, Y0.7 weaker than Friday’s close.
Similarly the yen sat Y0.6 weaker at Y118.17 to the US dollar, its weakest level since April, having peaked at Y117.15.
The yen was also Y0.3 weaker at Y88.76 to the Australian dollar and Y0.6 lighter at Y221.62 against sterling.
Source FT.com on Yahoo! Finance
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