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US Dollar Loses Most Against Japanese Yen in 10 Years
Monday, 06 October 2008 15:01:12 GMT  |  David Rodriguez, Quantitative Analyst
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The US Dollar lost the most against the Japanese Yen in almost-exactly 10 years, as tremendous losses in the US Dow Jones Industrials Average and other major indices sent the USDJPY over 4 percent lower through time of writing. Yen strength likewise forced the biggest EURJPY in its short 9-year history, while the Australian dollar likewise posted its single-day largest decline against the Yen since the Aussie free-floated in 1984.  

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Despite the US Senate’s passage of the proposed US Treasury bailout bill, the Dow Jones Industrials Average continues to drop, and fragile market conditions may indeed continue to boost the low-yielding Yen against higher-yielding counterparts. Indeed, the Yen posted impressive gains even against the safe-haven Swiss Franc—underlining the level of risk aversion in broader financial markets. Whether or not we can see Yen pairs recover is largely a function of whether conditions may stabilize, but the S&P 500 volatility index currently trades at an incredible 55.70 percent—its highest on record.

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Written by David Rodriguez, Quantitative Analyst for DailyFX.com

To contact the author of this report, e-mail drodriguez@dailyfx.com

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