The yen carry trade ghost to rise again..!?
The bank of japan (BoJ), the central bank of japan, on Friday, january 24, raised its key interest rate by 25 basis points and set the benchmark interest rate at 0.5%. Since the benchmark interest rate has been set at a high level in japan since the 2008 global financial crisis, the yen carry trade ghost is expected to erupt again in international stock markets. This decision by the bank of japan caused a stir in global markets. Following this announcement, the Japanese Nikkei index, which had been rising in the morning, reversed direction and fell. The 400-point increase recorded in the morning after the announcement of the interest rate hike decreased to just 100 points in the next few minutes. Following this, US futures contracts have also started to decline, and Dow Jones Futures contracts have also entered a downward trend. The impact of this on the indian market has not been directly and immediately reflected, the main reason for this is that most investments are made in the US market through Yen Carry Trade. Direct investments in the indian market are very low. The value of the Japanese yen against the US dollar has risen immediately after the interest rate hike. Currently, the value of the Japanese yen against the US dollar has strengthened to 155.
The bank of japan (BoJ), the central bank of japan, on Friday, january 24, raised its key interest rate by 25 basis points and set the benchmark interest rate at 0.5%. Since the benchmark interest rate has been set at a high level in japan since the 2008 global financial crisis, the yen carry trade ghost is expected to erupt again in international stock markets. This decision by the bank of japan caused a stir in global markets. Following this announcement, the Japanese Nikkei index, which had been rising in the morning, reversed direction and fell. The 400-point increase recorded in the morning after the announcement of the interest rate hike decreased to just 100 points in the next few minutes. Following this, US futures contracts have also started to decline, and Dow Jones Futures contracts have also entered a downward trend. The impact of this on the indian market has not been directly and immediately reflected, the main reason for this is that most investments are made in the US market through Yen Carry Trade. Direct investments in the indian market are very low. The value of the Japanese yen against the US dollar has risen immediately after the interest rate hike. Currently, the value of the Japanese yen against the US dollar has strengthened to 155.
