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Kiwi$ falls suddenly by almost 2 USc as Yen strengthens against US$

Kiwi$ falls suddenly by almost 2 USc as Yen strengthens against US$
17th Mar 11, 11:28am by Alex Tarrant

The New Zealand dollar fell by almost two US cents just after 10am this morning as the Japanese yen suddenly surged.

The Kiwi fell from 72.7 USc to just above 71 USc in under an hour, although it had recovered to 71.8 USc just after 11am.

The yen surge also had an effect on the NZ-AUS exchange rate, with the Kiwi falling from just over 74 AUc to around 73.5 AUc just after 11am.

The yen surge has fuelled speculation the Bank of Japan may intervene to stem the strengthening of its currency. Dailyfx.com reported via Twitter at 11:45am (NZ time) that a Japanese Ministry of Finance official said it was monitoring the JPY market, and had no further comment.

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5 Comments

by  Alex Tarrant  |  17th Mar 11, 11:33am 1300314819

A few comments from around the web. I got this from @JohnKicklighter (Dailyfx.com) via Twitter:

"A number of factors [for the yen surge]. People were unwinding yen exposure in general; but speculators were trying to pick a bottom. When you  trip their stops, the only liquidity you're left with is the offsetting short orders. Hence the wide spreads."

The guys at Dailyfx.com are saying the fall in USDJPY boosts odds of BoJ intervention to stem yen strength.

Then this is from someone on the Reuters live earthquake feed (http://live.reuters.com/Event/Japan_earthquake2)"

"a stronger yen means greater buying power for the Japanese -- in the near term that should help them procure necessities and aid reconstruction. yes, there may be market and export worries, but those seem secondary at the moment. correct?"

Your thoughts?

Cheers

Alex

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by  the_dc  |  17th Mar 11, 1:30pm 1300321851

Trying to rationalise these moves is pretty pointless. It was likely caused or at least exacerbated by some quant fund(s) imploding. Also volume is at it's thinnest NZ am time, so that wouldn't have helped.

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by  neco  |  17th Mar 11, 11:39am 1300315150
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by  anonentity  |  17th Mar 11, 12:21pm 1300317695

  Everthing is in crisis at the moment,with more predicted..The markets wont stabilise for months..If the fish die offs on the West Coast of America are a precursur of another siesmic event...A Black Swan event will ensue.A countries money will be what the Country is worth to the rest of the world..New Zealand will be on the front line for rising food prices, and its Coal reserves will be a most desirable asset.In fact the future looks rosey,for a place with hard assets.If the reports that the Yanks have increased the exclusion zone around Fukishima to 50 miles,and a full meltdown is taking place..Then all the manipulation of cash is B/S..

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by  Kunst  |  17th Mar 11, 12:40pm 1300318800

Yes – “The World Bucket”  has at least 5 big holes and the "Stupids" are still crying for more water.

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