Japanese Yen :: Essays Papers

japanese YenThe Japanese YenWhen Richard Nixon suspended the convertibility of US dollars to gold in 1972, the fixed treasure between the dollar and the yen was exchanged for a floating rate. The world-wide value of the yen rose sharply and is today one of the just just about attractive currencies on the market as it directs the worlds second largest economy. The yen is controlled by a central bank known as the Bank of Japan or BOJ. This central bank is under the supervision of the Minister of Finance. over the outgoing decade, the yen has fluctuated greatly. From early 1990 through mid 1995, the yen multiply in value from 160/$ down to 80/$. From 1995-1998, the yen baffled value and was back up in the 140s/$. The trend in the yesteryear year has been a steady increase in value for the yen. oer the past six months, the yen has fluctuated. From April through mid-July, the yen floated between 124/$ and 118/$. Since thence it has increased in value pay heeding to the area of 105/$. On Friday September 24, the closing rate on the yen was 104.24/$. Over this close week, the yen rose to a close of 105.0000/$. This means that the yen illogical a little value in comparison to the dollar. This slight fall is not representative of what is going on with the yen however. Over the past few months, investors have put money into Japanese stocks. The government is displace insisting on the BOJ to increase the yen supply in value to stave off inflation and curb long-term interest rates. This pressure came after a G-7 meeting in which the members suggested that Japan do something to give out the yen. Prices and wages are falling and output is below Japanese prolific potential. Despite these factors, the BOJ is hesitant about responding because it is concerned that expanding the yen supply will cause inflation. Last week, Japanese companies were becoming more optimistic about economic growth. The BOJ didnt take in cash from money markets on Sept. 30, going aw ay in twice the normal surplus, so traders felt that the BOJ would follow the topic of expanding the yen supply. The BOJ is conducting a survey on Monday Oct. 4 to see how optimistic business sentiment is as the economy tries to rebound. The yen could rise this future(a) week to its highest level since that 1995 value of 80/$.