The Nikkei is down over 6% over night on increased worries about the extent of the global recession/depression. Meanwhile the Yen carries on strengthening as a result of the end of the carry trade. The carry trade was the process whereby traders borrowed the Yen and used it to buy currencies with higher interest rates. As worldwide interest rates drop to Japanese like levels traders have been unwinding the carry trade, ie: using other currencies to buy Yen, which has boosted the Japanese currency.
The strength of the Yen is seen as a problem by the other leading economic powers but what can they do to force it down?
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