Today's Major Market Move: Japanese Yen Weakens 9.2% Against US Dollar Year to Date

The Bank of Japan is notorious for acting against the currency markets in an effort to drive down the value of the yen. In this post on October 30, 2011 we referenced two of the interventions in the latter half of last year. At some point, due in part to Japan's debt issues (well over 200% debt to gdp) and demographics, the market is going to snap back in the other direction. Will eventually the BOJ be the forced to intervene in the other direction (to strengthen the Yen)?

The Yen is currently in the midst of a fairly significant move having weakened 9.2% year to date:

Click here to go to the live chart.

Let's take a look at the Yahoo chart for a view over a longer time horizon:

Click here to go to the Yahoo chart.

The recent 9.2% move shrinks to insignificance and we see that the USDJPY has a long ways to go to get back to 120+ levels seen in 2007. However bear in mind that crude oil prices in 2007 were about 40% cheaper than what they are now. From the U.S. Energy Information Association:

Click here to go to the chart on the EIA website.

Prices at the pump in Japan are currently around $7.20/Gallon which puts Japan in the top 1/5 percentile of countries. In terms of major economies, only Germany has higher gas prices:

Click here to go to the live chart.