The yen depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the ¥97.90 level and was supported around the ¥96.90 level. The yen was mostly strong across the board but weaker vis-à-vis the U.S. dollar. The yen has given back some of the gains it made over the past few months. U.S. officials are becoming increasingly concerned that Japan is going to pursue a weaker yen to help bolster its beleaguered export situation. Japanese net trade data are quite weak and the unpopularity of the Aso government could see the government try to orchestrate a weaker yen. Dealers expect Bank of Japan will expand its asset purchase program to steer market rates lower in an attempt to stimulate the asset backed commercial paper market. The Nikkei 225 stock index shed 3.81% to close at ¥7,280.15. U.S. dollar offers are cited around the ¥104.15 level. The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥121.95 level and was capped around the ¥123.55 level. The British pound moved lower vis-à-vis the yen as sterling tested bids around the ¥135.90 level while the Swiss franc moved lower vis-à-vis the yen and tested bids around the ¥82.35 level. The Chinese yuan depreciated vis-à-vis the U.S. dollar as the greenback closed at CNY 6.8438 in the over-the-counter market, up from CNY 6.8405.
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