BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific Arabic Spanish Russian Chinese Welsh
BBCi CATEGORIES   TV   RADIO   COMMUNICATE   WHERE I LIVE   INDEX    SEARCH 

BBC NEWS
 You are in: Business
Front Page 
World 
UK 
UK Politics 
Business 
Market Data 
Economy 
Companies 
E-Commerce 
Your Money 
Business Basics 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
In Depth 
AudioVideo 


Commonwealth Games 2002

BBC Sport

BBC Weather

SERVICES 
Tuesday, 11 December, 2001, 01:07 GMT
Yen weakens as spotlight hits Japan
Prime Minister Junichiro Koizumi
Mr Koizumi's reforms have yet to materialise
The Japanese yen has sunk to its weakest level against the dollar in eight months as international investors turn their attention to the dire state of the world's second biggest economy.

Japan was officially confirmed in recession last week and there is little practical sign of much-touted economic reforms promised by populist Prime Minister Junichiro Koizumi.

Economists said fears about the shaky United States economy had taken centre stage since the 11 September attacks but the spotlight is now shifting to Japan .

"Investors are realising that things are deteriorating in dramatic fashion in Japan," said Audrey Childe-Freeman of Canadian Imperial Bank of Commerce.

Bad news to come

The immediate catalyst for the yen's decline below 126 to the dollar for the first time since April was data showing machine orders at a 14 -year low.

But investors are also bracing themselves for the release in Tokyo on Wednesday of a closely-watched quarterly survey of Japanese business confidence, known as the "tankan".

"The figures are bound to be much worse than those we saw in September," said Ko Haruki of HSBC in Tokyo.

"Results of the last 'tankan' said business conditions were awful. All indications suggest that companies will say that conditions are even more miserable now," said Carl Weinberg of High Frequency Economics in New York.

Next benchmark in sight

Noel Mills of Barclays Global Investors in London said "We don't like the yen...The problems for the Japanese do not look like they will go away".

At one point on Monday the yen was trading at 126.40 to the dollar, raising the spectre of its three-year low reached on April 2 of 126.84 against the dollar.

By 2200 GMT, the yen had strengthened to 125.96 to the dollar.

The Bank of Japan's "tankan" survey is due to be released on 23.50 GMT on Tuesday

See also:

07 Dec 01 | Business
Japan falls into recession
29 Oct 01 | Business
Bank of Japan warns of recession
10 Oct 01 | Business
Japan launches economy drive
16 Oct 01 | Business
Japan sets extra budget
26 Oct 01 | Business
Japan's consumer prices fall
25 Oct 01 | Business
Asian economies moribund
01 Oct 01 | Business
Survey raises Japan recession fears
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories