Dear all,

Many things have happened, which is a very good example about what affect Yen and what Yen affect the other things.

Yen didn’t rise after the BoJ announcement to increase their rate to 0.5% (decade high) on 21^st Feb, because at the announcement BoJ also told people that the rate would increase very slowly and people expect which means the rate won’t increase further and they are happy about the Carry Trade thing.

Carry Trade has been discussed broadly after the meltdown in China market 2 weeks ago. Since after the share market fell, then the currency traders pushed the Yen high and the need of Yen goes high, and the more aggressive sell off of shares to cover borrowed Yen has occurred. That’s the reason why last 2 weeks, even Europe and US market was suffered by high Yen.

Of course, as Japan is strong exporter country, high Yen means low profit margin to them and is not a good thing. Yen was under 120 last week and things are recovering now. Because of this cheap yen, actually the price of selling PS3 in Europe would cover the production price for the console, seems good news for Sony in this critical moment.

Eric