Yen gains as euro drops

The yen has gained for a second day after Akira Amari, Japan’s Economics Minister, warned the currency’s weakness could push up the price of imports and damage people’s livelihoods. State Street’s head of forex, Kimihiko Tomita, said the yen had fallen quickly, adding that if it falls to quickly a reversal could be equally fast.

The latest rebound for the Japanese currency is being seen by many as a limited correction on a generally downward trend. The drop started at the end of last year after Prime Minister Shinzo Abe said he intended to introduce measures to boost Japan’s sluggish economy.

The euro has fallen against the yen to 117.28 yen, a drop of 0.6 per cent. The slip came after eurozone finance ministers’ chairman Jean-Claude Juncker warned the single currency was too high. The euro also dropped against the US dollar by 0.1 per cent to $1.3289.

However, many traders feel that the comments will not cause a permanent reversal in the euro’s uptrend and simply gave investors the opportunity to profit from recent gains. The euro gained around three per cent recently after the European Central Bank appeared to be more positive about economic recovery within the eurozone.

Focus on the euro and the yen meant the dollar was unchanged against a number of other currencies including the Australian dollar.