The Japanese Yen is the strongest currency of the day, having rebounded against all of the major currencies. The US stock market reversed course in afternoon trading which has helped the Yen extend its rise. Stronger capital spending and labor cash earnings also helped, but both indexes remain in negative territory
They are headed in the right direction however because wage growth needs to edge back into positive territory before the Bank of Japan can consider raising interest rates. Central Bank Governor Fukui’s comments today were fairly neutral. He indicated that he was aware of the risks of keeping rates too low and pledged to raise them gradually but at the same time he was uncertain about how much damage the subprime crisis would have on the global economy.