The Yen’s sharp move last week was driven by Japan’s recent GDP figures that showed an annualized growth rate of 4.8% (the fastest pace in three years), strong personal consumption (+1.1% y/y), and an attendant 2.2% “pop” in capex spending (+2.2% y/y), suggestive that the era of low rates in Japan is drawing to a close and with it the weakness in the Yen and the potential for the unwinding of the now ubiquitous “Yen carry trade.”

The newly created ETF, Currency Shares Japanese Yen (FXY/83.92) began trading last week. 

This entry was posted on Tuesday, February 27th, 2007 at 9:09 pm and is filed under Main. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.