Japan Earthquake good for JPY?
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Thread: Japan Earthquake good for JPY?

  1. #1
    Hello, could anybody please clarify JPY still powerful even Japan Earthquake?

  2. #2

  3. #3
    Only a theory I read,

    Insurance payouts.

    As an example. . .Lloyds of London should buy JPY to pay their hedge to insurance companies in Japan so they can pay their insurance cover to individuals in Japan. GBP isn't accepted by people in Japan.

    Speculators are gambling on JPY rally because of it. A massive JPY rally following the Kobe earthquake in 1995 serves as a blueprint.

    This quake will have a major effect on how currencies behave in coming weeks/months because of cross border real-money flows in and out of Australia/Japan/UK/EU and Switzerland.

  4. #4
    Hi JFogel and EmeraldEye,

    Thank you very much for your answers and clarifies.

  5. #5
    If Japan is a significant Exporter then over the next time, JPY will not be in much need (because its exports decreased and the economy is in trouble due to its earthquake). If you are justifying the autumn in USD/JPY using the insurance policy concept, then can we anticipate that within the next time USD/JPY should increase significantly?

  6. #6
    Http://www.financemarkets.co.uk/2011...nterest-rates/

    Different countries approach disasters otherwise, and Japan can't take their rates considerably lower, but NZD lowered rates to aid with their own retrieval. If Japan lowered their rates, the down trend in usdjpy would probably intensify.

  7. #7
    Quote Originally Posted by ;
    Only a Concept I read,

    Insurance payouts.

    As an instance. . .Lloyds of London should buy JPY to pay insurance...
    hmmm same wasnt seen for the AUD flood and NZD earthquake...

  8. #8
    Usdjpy hit butt and big bull is beginning ans continue for 3 decades

  9. #9
    This will be a bit tricky during the upcoming few weeks -- imo. Today's action resulted from repatriating yen to pay for damages and risk aversion. However, the real extent of the damage has not yet been determined. When it's good (eg, some of the nukes melt ) then there might be a very major reversal and the yen may crash. Less dramatic if the damage is not as but infrastructure needs major repair (eg, reconstruct train lines, roads, fabricating plants). I feel bad for the people there and hope for the best, but things seem to be falling off at this moment based on the US media. I'm not a yen trader, but I'll work up those charts this weekend and also be on the charts this Sunday evening. God bless the people of Japan.

  10. #10
    Some reports say Japan is spiralling into bankruptcy and earthquake would be the last nail in the coffin.

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