JPY Index remained subdued this morning (29th). USD/ JPY once fell to 160.22, representing the first time since 1990 to sink below the 160 level. It last dropped 0.6% to 159.22. Meanwhile, JPY100/ HKD last stood at 4.89.
Japanese officials repeatedly warned that they will respond in case the yen depreciates too much or too quickly. But even though the yen has now fallen below the 160-to-dollar red line, the Japanese authorities have not stepped in.
Goldman Sachs strategists said that the global macroeconomic environment hinted that the yen will weaken further, which may make intervention hardly successful.
Deutsche Bank said that the ebbing yen is not necessarily unfavorable for Japan, because the depreciation of the yen has not triggered inflation problem, but rather shored up the value of overseas assets held by Japanese investors.
