Flash: The Yen has been the best performer – BTMU

FXstreet.com (London) - Derek Halpenny, strategist at Bank of Tokyo Mitsubishi commented, saying, “The yen is the best performing major currency”, on the open of markets this week. Abe comments might be an impact on markets favouritism for the currency as well as the risk aversion taking place due to the US Government shutdown .

Key Quotes:

“The yen is the best performing major currency… given the sell-off in Asian equities while comments from PM Abe also may be playing a role in dampening optimism over ‘Abenomics’”.

“In an interview with the FT PM Abe stated that labour market reform would not be part of his initial focus of reform as there is strong domestic opposition to this “sensitive” area of economic policy”.

“This is understandable to a degree – PM Abe has to proceed with caution in order to keep the LDP unified and hence the more contentious issues don’t necessarily have to be dealt with immediately. However, there is also an argument that PM Abe should take advantage of his electoral popularity while he has it to push for aggressive reform”.

“Also given the importance of rising nominal wages for ridding Japan of deflation, this issue will have
to be addressed”.