The G7 agreed to intervene to help Japan recover from the earthquake disaster. This is the first time the U.S., U.K. , Canada , European Central Bank and Japan have acted in concert in the foreign exchange market in over a decade. It was a response after Japans currency strengthened to post-World War II highs which seriously threaten economic recovery. Two days ago we saw USDJPY reach a low of 76.72. The intervention that began at 9am in Tokyo (00:00 GMT) immediately weakened the currency forcing USDJPY up to 81.98.
Since the news overnight which caused JPY to weaken, the major JPY crosses have come off the highs due to Yen strength on news in the early London session that Japans nuclear agency has raised Fukushima danger alert to ‘accident with wider consequences’ versus just ‘local consequences’.
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Zoe Fiddes, easy-forex, London.