How are you reading the yen story right now?
The yen's story is a three-body problem: the BoJ's path, the Fed's path and the threat of intervention (report).
Post your read:
- which of the three forces dominates now
- how you're positioning around the BoJ
- what intervention risk does to your stops
Background: the BoJ preview and safe havens.
Background: Safe-haven currencies: why the yen and Swiss franc rise in a crisis
When markets panic, money flows into a few currencies seen as safe. Why the yen, franc and dollar play that role, and when it breaks down.
Why is the yen a safe-haven currency?
Japan holds large foreign assets that tend to be brought home in a crisis, and the yen is widely borrowed to fund carry trades. Both lead to yen buying when markets fall.
What is a risk-off move?
A shift away from risky assets such as stocks and higher-yielding currencies, towards perceived safe havens such as the yen, Swiss franc, dollar and gold.
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