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13 November 2007



Where would you class the Linden dollar?

Anna Coulling

As a full time currency trader in the UK, I thought I would add my comment to your post on the Yen and the Japanese economy. In simple terms I believe there are several things to remember when trading the dollar yen or investing in yen assets. Firstly, the economy is unlike any other in the western world. It is highly dependent on its export markets which in turn are highly dependent on the strength or weakness of the yen. This in turn affects the speculation on the yen and in particular the carry trade which has been a favourite for many years due to the very low interest rates. This is likely to continue for some time to come and my own personal view is that the rates may be cut later this year back to 0.25%. Now bear in mind that a strong yen will adversely affect exports, and the interventionist Bank of Japan will ensure that this does not continue. In short, a recipe for a weak yen to dollar relationship for the foreseeable future. My personal view is that the pair will bounce back from below the psychological 100 barrier, back to somewhere between 105 and 110 in the short to medium term.

Account Deleted

The key tools that sustain the forex business is the foreign currency exchange rates. Their behavior and change in the forex market can drastically affect the course of your forex market business so you need to effectively monitor their course since these currencies tend to fluctuate a lot. Actually, there are many different reasons why these currency rates constantly rise and fall in the market. Economic behavior of the countries, trading process between other countries and political backdrop are the factors affecting it.

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