
Under the Banyan Tree – Stocks up, yen down: Putting Japan in context
HSBC Global Viewpoint
The US-Japan Yield Dilemma and the Japanese Yen
CURRENCIES often trade on yield differential, so there's the difference in interest rates between two economies. If a country economy has lower interest rates and its trading partner that usually is negative for the currency. Joey: Even though the US-Japan yield differential remains wide, if there are expectations that the Fed is going to ease as its next move, I think the dollar can weaken broadly. So this thing sort of maybe offset each other.
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