The yen has always been a hedging currency in the international investment market. If the risk aversion status is shaken due to the yen spread transaction, and the market selling formed by the formed market may be particularly fierce.
Jen is not only the worst Asian currency that has performed this year, but also the most embarrassing currency in developed economies in the world.On the basis of a sharp depreciation of 13.43%in the first three quarters, it was still sluggish after entering October.Whether it depends on the incremental pressure generated by the Fed's monetary policy to the yen, or the basic attitude of the Japanese government on the trend of the local currency, or the supporting force that the Japanese economy fundamentals may be formed, there is indeed the Japanese yen.space.
The yen has experienced four obvious depreciations in history in history, all of which have a close connection with the adjustment of the Fed's monetary policy.The first depreciation was from 1995 to 1997, when the benchmark interest rate in the US dollar was raised from 3.25%to 6%; the second depreciation was from 2000 to 2001, when the federal benchmark interest rate was raised from 4.75%to 6.5%;From 2005 to 2006, the benchmark interest rate in the US dollar was increased from 1%to 5.25%; the fourth depreciation was from 2012 to 2015, when it was on the eve of the sixth round of the Federal Reserve.The changes in the value of the yen at different periods of time basically reflect the characteristics of resonance with the US dollar. In the era when the US dollar becomes a global leading currency, the depreciation of the yen will often have passiveness, including the depreciation of this round.In terms of devaluation, the Bank of Japan has taken the initiative to act as a trace of intentional indulgence in this round of depreciation.
The Fed has pushed the federal benchmark interest rate to 5.25%to 5.5%. It may increase interest rates once this year, and the major central banks such as the European Central Bank and the Bank of the United Kingdom also have the possibility of raising interest rates.Change the policy tone of the Bank of Japan.According to the latest statement of the Bank of Japan, it will continue the loose monetary policy, which means that in addition to maintaining -0.1%interest rates, the Bank of Japan will also conduct operations of buying bonds in the future.The exchange rate and interest rates are positive. The US dollar exchange rate rises due to the tightening of the currency of the Federal Reserve. The yen exchange rate has declined due to the loose monetary policy of the Bank of Japan.Therefore, according to the interpretation of traditional currency theory, the decline of the yen is the suppression of a strong US dollar, but it is not exactly the case. To a large extent, the weakening of the yen is the cause of its own monetary policy.
The Bank of Japan has maintained negative interest rates for nearly seven years. It has been purchasing bonds (QQE) from the secondary market for up to 10 years.Blood transfusion and cheering. Specifically, I hope to create a virtuous circle of exports to create a significant export growth, moderate increase in prices, moderate prices, corporate profits, employment and wages.Uncertainty.
Data show that as of the end of September, although the GDP of Japan (GDP) has achieved four consecutive quarters of growth, it may not be ruled out that the fact that the problem is the most illustrate is that the Japanese manufacturing industry in September in SeptemberThe purchasing manager index (PMI) not only set the fastest reduction in seven months, but also below the 50 glory line for four consecutive months.On the other hand, although the inflation has exceeded the policy target value of 2%for 17 consecutive months, whether it can stabilize at more than 2%for a long time, the Bank of Japan is not fully grasped.In the case of not seeing the key indicators continued to go well and stabilized, it is difficult for the daily monetary policy to turn.
The yen faces the new depreciation pressure due to arbitrage transactions
In addition to negative interest rates and QQE littering yen, the national bond yield curve control policy (YCC) operated by the Bank of Japan also created a lot of thrust for the yen decline.After two adjustments last year and this year, the elasticity of YCC is currently relaxed to 1%. Although it has increased a lot, it can still ensure that the Bank of Japan is unlimited and low -cost to purchase government bonds.Data show that the scale of Japanese Treasury bonds has exceeded 100 million yen (about 9.21 trillion yuan), and the rise of national bond interest rates involves not only the increase in financing costs, but also more seriously that it may endanger the credit of Japanese Treasury bonds.
On the one hand, the interest rate of daily debt is artificially lowered, and on the other hand, the yield of US debt yields has continued to rise with the interest rate hike of the Fed.Yuan has always been a very active arbitrage trading currency in the international market. The greater the spread with the US dollar, the greater the market can win the arbitrage trading space. Many speculative capital in Japan borrowed the yen and exchanged for the US dollar investment in the United StatesDebt, to take the spread between the two, which leads to a strong demand in the US dollar, and it invisibly causes new depreciation pressure on the yen.
On the other hand, it is different from the difference between the Japanese investment institutions that mainly chase daily US debt yields. European and American investment institutions also look at the Japanese yen spread transactions that the Japanese yen trading continues to flood against the US dollar.Given that the scale of the yen spread transaction has always shown a high positive correlation with the depreciation of the yen against the US dollar, the larger the scale of the yen spread transaction, the higher the depreciation pressure of the yen against the US dollar.The yen spread transaction scale expanded the yen depreciation yield brought by the widening rate of yield yields in Japan and the United States, so we have seen that the scale of the funds participating in the yen spread transaction in the international market has continued to amplifyThe very obvious currency easing policy signal of the Bank of Japan has also caused many yen spread traders to have no fear and continue to expand and superimposed the forces of the short -selling yen.
Theoretically, if the devaluation of the yen is dominated by external factors, the Bank of Japan will be more alertly alert, and the actual willingness to intervene will be stronger. Once the critical value of the exchange rate changes will reachInternal forces dominate the devaluation of the yen. In order to pursue the maximum value of their own policy goals, the central bank will show a greater tolerance in the instead. In this case, the critical value of the Japanese central bank's intervention on the decline in the local currency often changes often changes.It is getting more and more blurred.
Regardless of whether in the second half of last year, when the People's Bank of China was depreciated to the psychological point of the yen to 145, the three big strokes sold the US dollar and bought the yen in three times, but after June this year, the Japanese yen also touched 145 times many times.In psychological passage, the Bank of Japan did not intervene in time as market conjectures, and more oral alerts.Behind the Bank of Japan's "calmness" compared with last year, it is that it has more expectations for the depreciation of the yen or even deliberately indulgence. This also shows that the "intervention line" of the central bank in the past does not have reference value.
Japan Central Bank changes policy or trigger global financial turmoil
From the result of the possible turn of monetary policy, as long as the relaxing attitude of the Bank of Japan does not change, the logic of the depreciation of the yen will not disappear, and the direction of the market for short selling yen will not change. The yen is in China.The possibility of decline in a long time.However, the key is that under the overwriting of the continuous depreciation of the currency, can the Bank of Japan stick to it as before. If the interest rate is forced to change the strings, the result may cause a serious hit of large -scale yen spread transactions, which will trigger global financial finance.turmoil.The yen has always been a hedging currency in the international investment market. If the risk aversion status is shaken due to the yen spread transaction, and the market selling lethality of the market may be particularly miserable.
From the results of debt repayment capacity and debt risk, if Japanese inflation continues to exceed the control target, it does not rule out that the Bank of Japan will consider giving up YCC, followed by the surge of daily debt yields, which will cause Japan to cause JapanThe huge losses of the central bank and other financial institutions have led to a sharp increase in the cost of payment of Japanese bonds, and the possibility of triggering the debt crisis is not ruled out.According to the estimates of the Ministry of Finance of Japan, the yield on the daily debt has increased by a percentage point, and the account loss of the Bank of Japan will exceed 220 billion US dollars. The Japanese government will increase the interest rate of 7 trillion yen.In this regard, the Japanese government has enough repayment of principal and interest, otherwise, while Japanese sovereign credit is destroyed, the holders of the global Japanese government bonds are also likely to become a pond fish.
The knot of competition from regional currencies and tradeAs a result, while the yen has depreciated this year, the major Asian currency has a small downward settlement. Although it is difficult to say that there is a resonance relationship between the two, it is worth noting that after all, the yen is a special mention of the International Monetary Fund Organization.One of the important currencies in the rights basket, when the currency exchange rate of other countries does not fully focus on the US dollar, changes in the price of the yen will also affect the rise and fall of other mainstream currencies.In addition, Japan is the main exporter of the Asian market. Export products also have a overlapping relationship with many Asian economies. Under the influence of the continuous depreciation of the yen, even in order to reduce the pressure of the local currency, the Asian countries dare not follow the US dollar to adjust the monetary policy.Otherwise, it will put its own exports into an extremely unfavorable competitive position.From the perspective of actual trade results, almost all Asian countries exports this year are more difficult than in previous years. In fact, the competitiveness of the currency competition in various countries caused by the continued depreciation of the yen, and eventually the export effect was caused by hedging.
The author is a professor of economics and graduate instructor
