Japanese Yen Gains as S&P 500 Falls, Australian Dollar Vulnerable
The Australian dollar has appreciated recently against the Japanese Yen, in part due to the continuing impact of the Greek crisis. With governments across Europe focusing on spending cuts and higher taxes, this has given a strong boost to Australian exports.
A possible weakening of the dollar against other major currencies, including the US dollar, will give some incentive for Australian exporters to focus on their export markets, making the AUD/JPY exchange rate quite attractive.
In contrast, the US dollar has depreciated against the Japanese Yen, pushing its exchange rate down. This has pushed up the Australian dollar, with the AUD/JPY exchange rate rising from 62.6 to 64.2 at the time of writing.
After a slow start to the year, the Japanese economy is showing signs of recovery, as the country’s economy is showing signs of stabilisation. This recovery has been driven by measures that have been adopted to help stimulate the economy, including spending on infrastructure, taxes and debt relief.
Because of the consistent performance of the Japanese yen over the past several years, this has been good news for many countries around the world. The United States has not been immune to this phenomenon, and Australia and New Zealand, as well as some other countries, have benefited from the consistent strength of the Japanese yen.
Unfortunately, the Japanese government has recently implemented measures to help support the currency, in order to maintain competitiveness in the global market. This has resulted in lower import prices and, at the same time, slower growth in the economy.
Although the Japanese economy is relatively strong, the recent measures may lead to an appreciation of the currency, particularly when compared to the S&P 500 index. Indeed, due to the latest measures, the Japanese yen has appreciated to parity with the US dollar, which has a negative impact on the S&P 500 index.
If the recent appreciation of the Japanese yen is sustained over the next few months, it may lead to an appreciation of the index, and a similar or worse performance than the last few years. However, with more stable governments around the world, there are a number of reasons why the Australian dollar is likely to rise over the next few months.
As the Japanese economy continues to recover, the Australian dollar will continue to appreciate. In the face of a recovery in Japan, the US dollar is seen as being somewhat weak due to a weaker economy.
The weakness of the US dollar and stronger Japanese dollar is likely to strengthen the Australian dollar, as well as those in many other major economies. This will mean that Australian exporters can more easily compete on price and quality with other major currencies, leading to further profits for Australia.
While the US dollar is strengthening against the S&P 500 index, the Japanese yen is holding firm, which shows how the Australian dollar is likely to appreciate. In addition, the depreciation of the Japanese yen means that the Australian dollar is likely to appreciate against other major currencies, including the British pound and the Euro.
With the Canadian dollar depreciating against the Japanese yen, the Japanese economy will have a positive impact on the Australian dollar, helping it to strengthen. This should also boost Australia’s export market, leading to increased profits for the Australian economy.
Even though the recent depreciation of the Japanese yen is unlikely to lead to a further appreciation of the index, its performance against the S&P 500 index will help to strengthen the Australian dollar, ultimately driving the price of the Australian dollar higher. The depreciation of the Japanese yen will make Australian products more competitive and increasing the export earnings for Australia, which in turn will boost the currency value and encourage more investment in Australian real estate.