The yen sliding to a once-unthinkable 200 per dollar level is now a risk ¡ª albeit an extreme one ¡ª for some investors.
Under siege from Japan¡¯s wide interest rate gap with other major economies to deepening concerns about Tokyo¡¯s fiscal outlook, the yen has tumbled to a 1986 low and cemented its place as one of the worst-performing major currencies this past year.
Traders see little long-term relief from the Japanese government¡¯s repeated warnings that it will take bold action to stem the decline. Any official intervention to bolster the yen is seen by many as a mere speed bump as investors judge Japan to be a laggard in raising interest rates to combat inflation, underpinning its structural weakness.
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