Focus continues on Japanese Yen as BOJ meets to decide interest rates which are currently at 0.3%.  With exports falling and currency strengthening Japan is suffering worst of all worlds.  The yen rose for the second day against both the dollar and euro as stock markets continue to plunge and investors continue to sell high yielding assets and pay back low cost loans to Japan – the carry trade has well and truly died for the time being.

With death of carry trade the yen extended gains against Brazilian real and South African Rand as investors now consider a global slump a foregone conclusion.  The South Korean won slid to its lowest level as emerging market assets are also shunned.

All yen crosses show scope for further downward pressure – the only question is whether the BOJ will intervene to prevent Yen strengthening further.

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