Japanese Yen

The currency of Japan. It was introduced by the Meiji government in 1871. The yen decimalized the previously used Tokugawa currency. It was originally pegged to gold (smaller units were pegged to silver). Following World War II, the yen switched its peg to the U.S. dollar through the Bretton Woods System. In 1971, the yen began to float because it had become undervalued and because the United States left the Bretton Woods System. The currency suffered from exceptionally low value in the wake of the Asian financial crisis, but stabilized by the mid- and late-2000s. It is a common reserve currency, and is one of the most commonly traded currencies in the world.

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References in periodicals archive

Very likely, the Japanese yen will remain volatile in the foreign exchange market over the next several years in response to both the uneven pace of the economic recoveries in the U.S.

Implications of the rising yen

At the end of the quarter, the current values of the German and Japanese yen reserve holdings totaled $18.0 billion for the Federal Reserve System and $15.1 billion for the Exchange Stabilization Fund.

Treasury and Federal Reserve foreign exchange operations

Following are the middle exchange rates for leading currencies against the euro, according to Reuters: CURRENT HIGH LOW US Dollar 1.2294 1.2312 1.2194 Japanese Yen 108.6 108.84 107.52 British Pound 0.8236 0.8244 0.8168 Swiss Franc 1.3176 1.3209 1.3074 Danish Crown 7.4479 7.4493 7.4476 Greek Drachma - - - Norwegian Crown 8.0164 8.02 7.96 Swedish Crown 9.5835 9.602 9.5262 Australian Dollar 1.4669 1.4683 1.4446 Canadian Dollar 1.3107 1.3115 1.298 Hong Kong Dollar 9.5762 9.5898 9.4961 Russian Rouble 38.4433 38.45 38.1825 Singapore Dollar 1.7169 1.7198 1.7087

Euro Rates at 0900 GMT - July 1

While investors' concern on the stability of Japan's financial system has added pressure to the Japanese yen, dealers said they are not sure about the strength of the dollar either.

U.S. dollar rises to 123.00 yen in N.Y

At the end of the quarter, the foreign currency reserve holdings of the Federal Reserve System and the ESF were valued at $19.5 billion and $16.1 billion, respectively, and consisted of German marks and Japanese yen.

Treasury and Federal Reserve foreign exchange operations

Investors were keen to buying the dollar and the Japanese yen which put the euro on the back burner; hence, its drop against major currencies.

USD still stable against KD to 0.281

Following are the middle exchange rates for leading currencies against the dollar, according to Reuters: CURRENT HIGH LOW Euro 1.2312 1.2351 1.2253 Japanese Yen 89.63 89.77 89.43 British Pound 1.4926 1.4974 1.4857 Swiss Franc 1.1001 1.1046 1.0994 Danish Crown 6.046 6.0743 6.0263 Norwegian Crown 6.4943 6.5449 6.485 Swedish Crown 7.759 7.8254 7.7579 Australian Dollar 0.8654 0.868 0.8596 Brazilian Real 1.7846 1.7846 1.7825 Canadian Dollar 1.0396 1.0442 1.0396 Hong Kong Dollar 7.7783 7.7796 7.7775 Mexican Peso 12.6996 12.7636 12.7032 Russian Rouble 31.1405 31.2535 31.045 Singapore Dollar 1.391 1.3967 1.39 South African Rand 7.6435 7.6875 7.59

Market Dollar Rates at 1200 GMT - June 25

This dynamic served to support the currencies and credit markets of the higher-yielding European countries, including Italy, Sweden, and Spain, at the expense of lower-yielding currencies, such as the Japanese yen. The generalized weakness in the yen helped support the dollar-yen exchange rate.

Treasury and Federal Reserve foreign exchange operations