Stock Market
By Pankaj K
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Yen jumped hard Tuesday. Sanae Takaichi's surprise political victory sent currency traders scrambling as speculation mounted about potential government intervention in forex…
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Takaichi's win pretty much caught everyone off guard, but her track record on currency policy didn't.
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The yen's surge came as other Asian currencies basically treaded water, creating an unusual divergence that had traders scratching their heads. China's yuan held steady at 6.
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India's rupee weakened to 83.50 against the dollar, continuing its slow slide amid trade deficit worries that just won't go away.
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Indonesia's rupiah stayed flat at 15,200 per dollar.
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South Korea's won didn't budge much either, holding around 1,180 per dollar as investors waited for export numbers due later this week.
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The real action centered on what Takaichi might actually do. Goldman Sachs put out a note Tuesday morning warning clients to "brace for volatility" in yen crosses, with analysts…
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Finance Minister Shunichi Suzuki didn't help calm nerves when he told reporters Tuesday that officials are "closely monitoring" currency moves and remain "ready to take necessary…
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European markets shrugged off the Asian drama. The euro held at 1.09 against the dollar, with traders there more worried about inflation data due Thursday than Japanese currency…
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Japanese exporters weren't celebrating the stronger yen, that's for sure. Toyota shares dropped 2.
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The Bank of Japan's next policy meeting is February 28, and Governor Haruhiko Kuroda will probably face tough questions about coordination with the government on intervention.
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Singapore's dollar traded at 1.35 against the greenback, with the Monetary Authority there maintaining its current policy stance. Australia's dollar hovered around 0.
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Gold dropped to $1,820 per ounce as the stronger yen reduced demand for alternative safe havens.
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Nobody from Japan's Finance Ministry responded to requests for comment about specific intervention plans or timing.
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Bank of Japan data shows the currency hasn't traded above 135 since October, making Tuesday's move particularly significant for carry trade positions.
The Currency Analytics
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