Japanese Yen Dives on Rebound in Carry Trades

[DailyFx]

The Japanese yen plummeted across the majors on Thursday – especially the high-yielding Australian and New Zealand dollars – as carry trades made a comeback.



Indeed, news that the government is formulating a plan to aid the financial markets along with new rules against short sales in the US and the Federal Reserve's $180 billion emergency liquidity injection helped to improve investor confidence. It remains to be seen whether this sort of sentiment will hold, and the next move for carry trades will likely depend on if an official plan is announced on Friday. Overall, my long-term bias on the Japanese yen is bullish, as I believe that bouts of risk aversion will last for quite some time.

Related Article: Japanese Yen Forecast: Forex Trading Positioning Signals Further USDJPY Losses


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