The yen advanced against all other major currencies today after the Bank of Japan announced a rate cut to a near-zero level and the investors ran from the risky assets into the Japanese and U.S. currencies.

The Bank of Japan reduced the target overnight rate from 0.3 percent to 0.1 percent at its meeting on December 19 and said that it will use the additional liquidity to help the domestic companies with their debt.

The recent rate cuts by the Federal Reserve and BoJ are the signals that the markets are more than troubled. Central banks show that they are fighting with the crisis and the crisis is in the state which requires such measures. Investors in their turn decode this message as the signal to continue converting to 'safe haven' assets. Result — the yen and the dollar are likely to continue appreciating.

Analysts focus the market participants' attention on the central banks' pledges to buy out the corporate debts instead of the lower interest rates. The target rates in both U.S. and Japan are extremely close to zero and they won’t go negative. The next tool left to regulate the markets is the direct help to the financial institutions and the nation’s industrial leaders.

USD/JPY fell from 89.55 to 88.67 as of 9:16 GMT today. EUR/JPY went down from 127.79 to 124.80, while GBP/JPY declined from 134.65 to 133.14 and reached its lowest level since May 1995 at 132.53 today.

The Japanese yen posted its first daily drop against the U.S. dollar after 5 days of gains as the Japan's Finance Minister said that the currency intervention will be used if needed to keep the yen from the excessive appreciating.

Finance Minister Shōichi Nakagawa said today that the Bank of Japan will use the currency intervention for the first time in the last four years to protect the exporters if such means will be required. During the intervention the central bank sell the yen and buys the dollars out of the market to weaken the yen against the U.S. dollar, thus helping the domestic industry.

The yen appreciates against the dollar since August this year and it reached its new 13-year minimum yesterday. The U. S. Federal Reserve cut the interest rate below the Japan’s level making the dollar a less desired currency and opening a new possibility for the yen to continue strengthening.

Other Japanese officials believe that the intervention is a needed step and also a very probable one considering the recent currency gains and the ongoing global recession. Currency analysts expect some unpredicted volatility if the Bank of Japan uses the currency intervention without a proper announcement.

USD/JPY rose from 87.34 to 87.81 as of 8:30 GMT today with a daily maximum at 88.28. EUR/JPY rose from 125.80 to 126.87 after reaching its daily high at 127.40 — its peak since November 10. NZD/JPY went up from 51.74 to 52.46 today.

The U.S. dollar continued to go down today against the euro and the yen as the traders expect a rate cutting decision from the Federal Reserve and the bailout of the U.S. automakers.

While both interest rate cut and the bailout of the country’s biggest car-making companies are the positive factors for the whole U.S. economy, they are certainly hurting the U.S. dollar, which may continue depreciating on the Forex market. The dollar went down to the lowest level in the last 7 weeks against the euro and traded below the Friday’s close against the Japanese yen.

There are chances that the interest rate in the United States will be reduced to 0.5 percent during the two-day FOMC meeting, which begins today. Analytics see no real obstacles for the dollar to continue depreciating, especially against the euro, as the most of the funds repatriation is already over and the European currency looks excessively oversold now.

EUR/USD rose from 1.3390 to 1.3475 as of 10:19 GMT today after reaching 1.3499 — its highest level since October 20. USD/JPY declined slightly from 90.93 to 90.75 with the daily low at 90.48. GBP/USD went up from 1.4958 to 1.5015.

The stock markets fell down greatly today pushing the Japanese yen up to its highest level since mid 90’s against the U.S. dollar and the Great Britain pound as the GM and Chrysler chances to survive narrowed after the U.S. lawmakers failed to approve the bailout plan.

Unlike previous trading sessions, where the yen moved in a unison with the U.S. dollar as both were considered to be 'safe haven' investments, now the yen is winning and the dollar is losing greatly. The U. S. currency suffers from the big troubles with its economy — high job losses, low consumer, production and service sentiment indexes and now the possible downfall of the biggest automakers.

The yen looks more attractive than the U.S. dollar and some higher yielding currencies because Japan didn't receive the same damage from the global financial crisis. And now the traders also shouldn't be afraid of the currency intervention from the Japanese monetary authorities as Finance Minister Shōichi Nakagawa said today.

USD/JPY fell from 91.45 to 90.44 as of 9:32 GMT today after reaching as low as 88.60 — the lowest level since August 1995. GBP/JPY declined from 137.54 to 135.42, with the daily minimum lying at 133.16 — the lowest since June 1995. EUR/JPY didn't break any significant records today but fell from 122.06 to 120.95 with the daily low at 118.21.

The U.S. dollar dropped to the weakest level during the last 6 weeks against the European currency as the world’s stock markets rallied despite the delay in the U.S. automakers bail-out.

As it has become known yesterday, the $14 billion bail-out plan to rescue the General Motors Corp., and Chrysler LLC is likely to not get voted for by the Republican party in the U. S. Senate. The dollar declined today not only against the euro, but also against the Britain's pound and the Japanese yen and the world’s stock markets went up moderately.

Some market participants remain too concentrated on the automakers bail-out plan, which isn't a big deal according to some analysts. The overall state of the global economy and the liquidity should be taken into account when analyzing the currencies. And the risks are becoming less of a concern today as the stock markets turn to the Christmas and New Year rallies.

EUR/USD rose from 1.3020 to 1.3100 as of 8:45 GMT today with the daily high at 1.3157 — the maximum level since October 30 this year. USD/JPY fell from 92.78 to 92.23, while GBP/USD went up from 1.4797 to 1.4923 today.

The Japanese yen is showing another negative trading day this week as the currency traders follow the stock market optimism and buy the currencies associated with the high risk and yield.

The yen fell against the Australian and New Zealand dollars (its traditional carry trade counterparts) as the U.S. government and lawmakers are ready to bailout the Detroit automakers, spurring stock market rally and helping the high-yielding assets worldwide.

While the crisis is not over yet, the currencies and assets are already heavily oversold according to some analysts. There are good opportunities in Forex market that involve yen-selling in the favor of the high interest rate currencies. When the majority of the market participants understands that the runaway to the "save haven" is over the rallies on EUR/JPY and GBP/JPY will probably start.

USD/JPY rose from 92.28 to 92.80 as of 15:33 GMT today. EUR/JPY advanced from 119.27 to 120.91 coming close to its monthly high at 121.44, while GBP/JPY went up from 136.11 to 137.75 today.

The Japanese yen went down rapidly against the other currencies today as the European and Asian stock markets rallied on expectations for the effect from the global anti-crisis measures.

The bail-out of the Detroit automakers has been almost approved in U.S. and that induces some hopes for the crisis easing in the near future. Better financial conditions benefit such currencies as the Australian and New Zealand dollars and reduces the attractiveness of the safe «haven» currencies — U.S. dollar and Japanese yen.

While the short-term loans provided to the U.S. auto giants aren't enough to save them in long-term, the positive moment is easily caught up by the stock markets. Stocks in their turn have a strong influence on the currency flows — turning them out of the Treasury notes and the Japanese bonds.

During the Asian trading session the Japanese stocks benchmark index Nikkei gained 5.19 percent today. The German DAX is currently trading with a 5.66 percent growth.

USD/JPY rose from 92.71 to 93.24 as of 10:04 GMT today, reaching as high as 93.89 earlier today. EUR/JPY went up from 117.90 to 120.06, while GBP/JPY rose from 136.46 to 139.21 after reaching a daily maximum at 140.71 today.

The euro declined today against the U.S. dollar, almost snapping the yesterday's gain, as the traders expect the weak data on the Eurozone retail sales after PMI shrank in the leading Eurozone economies.

The European currency came close to the lowest level in the last two weeks against the dollar and the lowest in the month against the yen. As the macroeconomic indicators show the worsening of the situation in the Eurozone's economy, the traders expect that the European Central Bank will reduce the interest rate from 3.25 to 2.75 percent at its next meeting tomorrow.

The British pound follows the euro's behavior and is advancing its weekly lows against the dollar and yearly bottom against the yen. The fundamental data from the United Kingdom make the market participant to think that tomorrow the Bank of England will cut the interest rate from 3 percent to 2 percent.

The poor economic outlook from both Great Britain and the Eurozone suggest that the rate cuts are necessary. Lower rates will continue to press on their currencies, analytics say. Even after these monetary policy meetings the rate reductions series may not be over yet.

EUR/USD fell from 1.2726 to 1.2614 as of 9:37 GMT today. EUR/JPY declined from 118.48 to 117.36, while GBP/JPY went down from 138.95 to 136.61 and renewed its more than a decade minimum. GBP/USD fell from 1.4919 to 1.4681 today.

The U.K. pound continued to fall against the U.S. dollar and the Japanese yen today, despite the correction seen in some other dollar- and yen-based currency pairs, as the traders expect a major rate cut by the Bank of England.

Traders bet that the Bank of England will have to cut the interest rate by 100 basis points down to 2.00 percent on December 4th to protect economy from falling down even faster amidst the recession and the global financial crisis. While positive to the economy such a rate cut will definitely eliminate one of the main advantage of the British pound — its high yield.

Currency analysts believe that the pound is still viewed as the high-risk and high-yield currency and behaves according to the respective market patterns. But if the BoE's interest rate decreases continues at the current pace, the pound may soon join the dollar and the yen in their "club" of the currencies with the rate close zero.

GBP/USD declined from 1.4886 to 1.4829 as of 10:16 GMT today. GBP/JPY dropped only slightly today — from 138.42 to 138.03, while EUR/GBP rose from 0.8473 to 0.8527.

The measures proposed by the U.S. government to support the national financial system and the optimism that followed the announcement of Obama's economic team caused the U.S. dollar to decline against the euro this week as the money risks decreased world-wide.

The U. S. dollar is currently heading for the second negative week against the euro and the British pound and for the third one against the Japanese yen. The developed and emerging countries (including China) showed commitment to continue spending their foreign reserves (denominated mainly in dollars) to boost the economy during the crisis.

The reason behind the growth of the dollar during the recent months lies in the repatriation of the investments during the liquidity crisis. The currency analysts believe that the end of this process is near and the dollar may start to depreciate as the investors will be willing to enter the emerging markets backed by the local government's stimulus.

EUR/USD rose from 1.2899 to 1.2929 as of 7:38 GMT today to the total of 2.5 percent weekly growth. GBP/USD went up from 1.5387 to 1.5424 or 3.1 percent on the weekly scale. USD/JPY declined slightly today — from 95.33 to 95.24, while the weekly drop is currently at 0.7 percent.

The British pound fell today against the U.S. dollar and the yen, following the three days of growth, as the traders expect the GDP report to confirm a decline of the economy today.

The traders expected that the today's Q3 GDP report will confirm the 0.5 percent decline seen in the advance report a month ago. The report will be released today at 9:30 GMT. Although it won't mean a recession in U.K. yet, the continuing decline in the fourth quarter will turn the year-to-year GDP change to negative.

The elevated optimism during the first two days of this week and last Friday brought the 4.9 percent growth to the pound versus the greenback. From this point of view, the today’s slight decline is just a temporal correction.

GBP/USD fell from 1.5455 to 1.5354 as of 8:36 GMT today, while GBP/JPY declined from 147.32 to 145.74.

The Japanese yen rose today against the major currencies after losing for two days as the U.S. macroeconomic reports will show the worsening of the crisis, according to the analysts' expectations, and the investors will cut the amount of assets funded in the Japanese currency.

The yen experienced one of the worst days yesterday as the stocks surged in U.S. on the revealing of the Barack Obama's administration's economic team and the bail-out plan for Citigroup. The demand for the high-yielding assets rose and the yen declined more than any other currency.

The advance report for the third quarter U. S. GDP showed a decline of 0.3 percent almost a month ago. Today, the preliminary report is released and the analysts expect that the decline will be revised to 0.5 percent. The extended contraction of the world's largest economy will surely hurt the high-yielders and benefit the Japanese yen.

On one hand, the today's growth of the yen may be just a correction, but on the other hand the overoptimism of the last two trading days was probably just predating a deep worsening of the situation and the further yen's gains.

The Japanese yen rose slightly today after losing for the two days on the currency trading market as the U.S. bail-out plans failed to raise the confidence in the high-yielding assets, favoring the yen as the safe-haven currency.

Investors has hoped that the part of the $700 billion plan proposed by the U.S. Treasury Secretary Henry Paulson would go to the car manufacturers (GM, Ford and Chrysler). It turned out that the U.S. lawmakers are probably not going to approve that. The yen also rose against the Australian and the New Zealand dollars as the Asian stock markets declined slightly today.

The Japanese yen still remains in the focus of the Forex traders as the lowest interest rate makes it the one of the safest investments in the troubled financial market. Each bad news for the global economy is a good one for the Japanese currency. Japan's interest rate is currently at 0.3 percent compared to 1 percent in U.S., 3.25 percent in Eurozone and 3 percent in U.K.

USD/JPY declined from 96.92 to 96.78 as of 7:47 GMT today after reaching as low as 96.33 during the early Asian trading session. EUR/JPY fell from 122.48 to 122.38 after touching its daily low at 121.46. GBP/JPY went down from 145.16 to 145.08, setting the daily minimum level to 143.85.

The Japanese yen declined against the other currencies today after opening with a positive weekly gap as the world’s third largest economy contracted for the two consecutive quarters according to the Japan's government.

The Gross domestic product (GDP) decreased 0.1 percent in the third quarter of 2008 according to the preliminary report by Japan’s Economic and Social Research Institute. This contraction followed 0.9 percent decline of GDP in the second quarter of 2008. GDP dropped at 0.4 percent annual rate in the third quarter.

Japan has entered its first recession since 2001, but according to many market analysts it may become the worst one in two decades. The Japanese stock market index Nikkei dropped 44.7 percent this year.

The global financial crisis is hurting the export-orientated and debt-ridden economy as the country’s production giants are slashing profit forecasts for the fourth quarter of this year and the whole 2009. The interest rates set by the Bank of Japan are already lowest among the most developed countries, limiting the ability of the financial authorities to stimulate the economy by the common market regulation instruments.

USD/JPY rose from 96.27 to 96.85 as of 9:44 GMT today after reaching 97.55 during early trading. EUR/JPY went up from 120.65 to 122.77, following 170 pips negative gap on the week's opening. GBP/JPY rose from 141.15 to 144.61 after posting 190 pips negative gap today.

The Japanese yen rose against the U.S. dollar, the euro and the pound today after posting a huge loss yesterday and the traders reviewed their outlook of the global recession process.

The Group of 20 nations summit is starting today at Washington, U.S. It will try to come up with the decision aimed toward the global financial crisis and protecting the nations from the impact of this crisis. Traders are generally skeptical about this meeting and its possible results.

The Japanese yen — the "safe harbor" of the currencies — posted a gain today against the other major currencies after losing a lot yesterday as the stock markets showed a strong (over 6 percent) growth in U.S. The yesterday's correction was caused mainly by the technical factor, while the today's growth of the yen is the continuation of the general long-term trade, as many Forex traders believe it.

The yen dominance over the dollar and the euro may continue to grow on the currency markets after the G20 summit as it's quite doubtful that the really effective decisions will be carried out there. Analysts believe that the U.S. and European officials won't have a chance to discuss some important problems of the global economy.

USD/JPY declined from 97.70 to 96.95 as of 8:46 GMT today. EUR/JPY rate decreased from 124.92 to 123.14, while GBP/JPY fell from 144.89 to 144.11 after correcting the least among the majors yesterday.

The Great Britain pound continued to trade below the psychologically and technically important level of $1.5 per pound for the second day today as the recession continued to show up at its worst in Europe and the U.S. rescue plans changed.

The pound went down below the $1.5 rate yesterday — for the first time since June 2002. It now continues to trade below that level, but is up in a daily period. The U. K. financial sector jobs contracted in October for the second month in a row, indicating serious problems in the economy.

The expectation that the Bank of England may continue with the interest rate reductions if the economy continues heading downward is a major negative factor for the pound. $1.4 per pound isn’t something impossible if the rate will be cut again on the next BoE meeting on December 4th.

The U. K. currency has already lost 25 percent against the dollar and 12 percent against the euro since the beginning of the year. It may extend its loss to at least 30 percent against the dollar by the end of this year if no real positive news from the financial and real estate sectors come soon.

GBP/USD rose from 1.4854 to 1.4935 as of 9:38 GMT today after declining to 1.4809 — the lowest since June 2002. GBP/USD fell from 1.5378 to 1.4856 yesterday. EUR/GBP reached its all-time high at 0.8412 yesterday.

The Japanese yen fell against the U.S. dollar and the other major currencies today after the money-market lending conditions eased and the traders expect a positive opening from the U.S. stock market judging from the current futures trading.

Apart from the three other major currencies, the yen posted a daily drop against its usual carry trade counterparts — the Australian and New Zealand dollars after rising against them for the two consecutive days. The U. S. dollar accompanied the yen in its decline, falling against the euro and slightly against the British pound.

Like with the other similar corrections before, during the last two months, this one may just last for not very long. If the real trading session on the U.S. stock market starts with the less optimistic action than the futures predict, the return to the «safe-haven» dollar and yen may continue.

USD/JPY rose from 97.60 to 97.70 as of 8:48 GMT today after rising to the daily high at 98.07. EUR/JPY rose from 122.13 to 122.67 with a daily maximum at 123.85. GBP/JPY went up from 150.10 to 150.29 after reaching as high as 151.76 during the early trading.

The Great Britain pound continued to fall today against the other major currencies after reaching the all-time low against the euro as the home sales report showed the lowest level in the last 30 years.

The Royal Institution of Chartered Surveyors released its October issue of the U.K. real estate market survey. It showed that the quarterly number of completed sales per surveyor (real-estate agent) fell to the record low — 10.9 homes. It’s the lowest level since the RICS began to conduct these surveys in 1978.

Pound is still trading in the strong downward trend against the current Forex favorites — the U.S. dollar and the Japanese yen. The trend against the euro is less distinctive, but the pound is losing to its younger counterpart in the long-term. The traders expect the new rate cuts from the Bank of England, which is more tolerant to the lower interest rates than the European Central Bank.

GBP/USD fell from 1.5626 to 1.5586 as of 8:47 GMT today. GBP/JPY declined from 153.11 to 152.21, while EUR/GBP rose from 0.8160 to 0.8177 today after reaching 0.8210 yesterday — the highest level since the euro's inception.

The U.S. dollar declined against the euro and the British pound as the traders expect that the release of the important employment data from U.S. will show the worst contraction since 2003 today.

After two days of falling against the Japanese yen, the U.S. currency is currently standing almost unchanged after losing somewhat during the Asian trading session. The bad reading of the October employment data may push Fed for another significant interest rate cut, probably reducing its value to 50 basis points.

The analysts and the investors express a lot of doubt about the U.S. macroeconomic fundamentals and the corporate statistics. The non-farm payrolls data release is in the main focus during today's currency trading.

According to the analysts' estimate, the U.S. payrolls fell 200,000 in October and the unemployment rate rose to 6.3 percent. The report will be released today at 13:30 GMT. It will take a highly positive surprise from this report to shift the current intraday Forex trading trends.

EUR/USD rose from 1.2677 to 1.2822 as of 9:24 GMT today after two days of decline. GBP/USD went up from 1.5568 to 1.5732, while USD/JPY dropped slightly — from 97.45 to 97.39.

The Europe's currencies posted a daily drop against the U.S. dollar after showing a moderate volatility during the early trading session after the regional central banks cut the interest rates at an unexpectedly large scale.

An increased volatility on the Forex market was the direct reaction to the series of the interest cuts performed by the central banks of the United Kingdom, Eurozone and Switzerland today. Just after the surprisingly big cut by the Bank of England, pound began to recover against the dollar and the Japanese yen but after the Swiss National Bank and the European Central Banks also cut the rates, the pound and other European currencies went down.

Bank of England lowered the interest rate by 150 basis points today — down to 3 percent. The largest expected cut was 100 basis points and it wasn't quite a popular forecast. Swiss National Bank cut the Libor target range by 50 basis points to 2 percent average. European Central Bank also slashed 50 basis points from the 3.75 percent rate, showing its conservative character even during the harsh crisis times.

EUR/USD fell from 1.2927 to 1.2754 as of 13:05 GMT today. GBP/USD continues to show excessive volatility and is currently trading near its open level at 1.5880. USD/CHF rose from 1.1588 to 1.1713 today.

The U.S. dollar strengthened its position against the euro and the British pound as the investors believe that Barack Obama’s clear victory in the U.S. presidential elections will help him to take measures soon to revive the world's biggest economy.

The news that the Democrat Barack Obama won the presidency over its Republican rival John McCain created the main positive background for the dollar trading on Forex today. The Democrats also extended their presence in the U.S. senate. Meanwhile, the euro and pound declined on the expectations of the further interest rate cuts.

Obama now has all the necessary conditions (including the absolute majority win and the loyal Senate) to conduct his 'change' policy that should be aimed against the crisis. The dollar may continue to rise with the growth of the confidence in the U.S. economy.

One of the anti-crisis actions proposed by Obama is the 'middle-class stimulus plan' worth $175 billion, which will help to boost the spendings and will positively affect the economy. The lack of the liquidity declined world-wide as the money-market rates and the LIBOR fell.

EUR/USD fell from 1.2995 to 1.2873 as of 9:01 GMT today, while the GBP/USD rate declined from 1.5962 to 1.5913. Both currency pairs showed a strong growth yesterday.

The Great Britain pound gained today against the other major currencies as the growth on the global stock markets spurred optimism and the high-yielding pound showed a stronger reaction to this uprise.

The British currency was among the worst performers of the last two months when the credit crunch went deep into the global economy. The United Kingdom has one of the highest interest rate (4.5 percent) among the major economies and it’s currency was one of the first to fall when the high-risk assets were dumped by the investors.

The today’s growth in the Asian stock markets and the positive opening of the European markets contradict the analysts’ expectations that the macroeconomic indicators will continue to worsen worldwide.

The Bank of England will meet this Thursday to decide the next interest rate; the median forecast by the major market strategists show that the rate will be cut by the 50 basis points to 4 percent. Such a rate reduction will be most likely considered as a positive news for the pound as it will help to fight the financial crisis.

GBP/USD rose from 1.6100 to 1.6217 as of 9:47 GMT today. GBP/JPY went up from 158.29 to 160.97, while EUR/GBP declined insignificantly from 0.7923 to 0.7922 after reaching a daily bottom at 0.7844.

The Japanese yen gained versus the dollar, the euro and the pound today after the traders saw the signals of more troubles in the global financial system as the Bank of Japan cut the interest rate.

The Bank of Japan cut the rate by 20 basis points today — lowering it from 0.5 percent to 0.3 percent, with three of the eight board members voting for reducing the rate to 0.25 percent. Investors saw the fear of the worsening of the current situation in the world’s economy in this decision.

The Japanese yen rose against its traditional carry trade counterparts — the Australian and New Zealand dollars as the commodity prices fell with the increased economical risks. The growth of the yen against the U.S. dollar was largely dictated by the the interest rate decision, which made the yen an ultimate safe haven reserve currency.

The current growth of the low-risk currencies (such as the yen and the greenback) is amplified by the two main sources — moving the assets to safety and the sale of the assets that were bought by the U.S. and Japanese investors and involved currency conversion. The second source isn't infinite and when the vast majority of such assets are sold, the growth of the yen and the U.S. dollar will slow down significantly.

USD/JPY fell from 98.62 to 97.05 as of 10:16 GMT today. EUR/JPY went down from 126.98 to 123.60 and GBP/JPY declined from 161.51 to 156.53 today.

The U.S. dollar traded with an alternate success against the other major currencies as the investors are uncertain before the Fed's interest rate meeting today and the state of the global financial system.

After a strong growth on the U.S. stock markets yesterday and the second day of a reasonably fast advancement of the Asian stock markets, the investors are unsure whether to continue dumping the risky assets or to return to the pre-crisis portfolios.

The Federal Open Market Committee will probably lower the target funds rate by 50 basis points today — from current 1.5 percent to 1 percent. With the lower oil and energy prices, cheaper imports (due to the stronger dollar), the consumer inflation may become not such a big concern for the Fed, untying its hands to cut the rates to the record lows.

From the technical analysis point of view, the current break in the downward tend of EUR/USD, GBP/USD, EUR/JPY and other such currency pairs isn't a turning point. There were far more deeper corrections in September, but the bearish trend returned.

The Federal Reserve's FOMC will announce its interest rate decision today at about 20:15 GMT.

EUR/USD dropped from 1.2814 to 1.2754 as of 9:27 GMT today, with a daily low at 1.2627. GBP/USD rose from 1.6025 to 1.6036 with a daily maximum at 1.6217. USD/JPY went down from 98.20 to 97.32, reaching the daily lowest rate at 96.08.

The Japanese yen posted the first daily decline against the euro and the pound and the second against the U.S. dollar as the Asian stock markets rebounded and the intervention talks arose in Japan.

The extremely fast growth of the yen for almost 6 days set up the speculations that the Japanese central bank may use a currency interventions to support the national exporters. Japan’s Finance Minister Shoichi Nakagawa said that the government is ready to act against the currency's imbalanced appreciation if needed.

The Nikkei index gained 6.4 percent in Tokyo today, spurring some confidence into the global financial stability. It would be a premature decision to believe that the troubles and crisis are over, but the current long-term bearish trend gets a break at least for today.

Currency market analysts believe that the Bank of Japan will use intervention to slow down the yen's growth after it gained 14 percent against the U.S. dollar and 29 percent against the euro this month. It's quite unlikely that the trend will be broken, but the yen will certainly correct if the intervention is used.

Group of Seven officials also expressed concern about the yen’s surprisingly high volatility during the last several weeks. The first yen intervention since March 2004 can be a direct reply to this statement.

USD/JPY rose from 93.29 to 94.68 as of 9:14 GMT today. EUR/JPY advanced from 116.18 to 118.39, reaching a daily high at 120.56. GBP/JPY went up from 144.82 to 147.64 after peaking at 151.16 today.

The Japanese yen rose up to the 13-year high versus the U.S. dollar and the new long-term maximums against the other major Forex currencies today as the high risk carry trades were shunned by the traders.

The yen also climbed to the highest level against the euro in last 6 years as the probability of the recession in the Eurozone countries rose significantly. The spread of the credit crisis in the European countries signals that more liquidity may be required to keep the financial system form crash soon.

Another yearly record was shown against the Great Britain pound. The yen reached the 8-year maximum versus the British currency today after the commentaries by the country’s monetary authorities that indicated that the U.K. is heading into recession this year.

Analysts believe that the current extremely fast growing of the yen is dictated by the unwinding of the carry trade. Yen-based carry trade involve selling low-yielding and low-risk yen for the high-yielding risky assets, including other major currencies. As many investors favored the carry trade in the past 7 years, pushing the Japanese yen down below the just price, what we see now is the massive sale of those positions.

USD/JPY fell from 97.99 to 94.98 as of 8:09 GMT today, losing more than 3 percent in a single Asian trading session. EUR/JPY declined from 127.07 to 120.23 — almost 5.4 percent daily decline. GBP/JPY dropped from 159.80 to 150.43, posting the highest relative loss today — 5.8 percent.

The Great Britain pound dropped to the lowest rates in several years against the dollar and the yen and the weekly low against the euro today after the BoE Governor Mervyn King said that the recession is very likely due to the worst banking crisis since World War I.

The pound fell to the lowest level since September 2003 against the U.S. dollar as the investors expected the first year with the negative GDP change in more than 17 years. Traders also react on the expectations of the minutes of the last interest rate meeting by the Bank of England that will be released today.

The traders also expect that the current interest rate of 4.5 percent will be cut soon; the total cut may reach 2 percent in one year. A return to $1.5 per pound rate doesn’t look improbable now.

GBP/USD fell from 1.6694 to 1.6298 as of 8:28 GMT today, reaching the daily minimum at 1.6203. GBP/JPY declined from 167.53 to 161.55 today, losing more than 3.5% in a single trading session and reaching the lowest level since December 2000. EUR/GBP rose from 0.7820 to 0.7904 today.

The U.S. dollar rose today against other major currencies, except the yen, after the Federal Reserve Chairman Ben Bernanke proposed further measures to provide more liquidity and credit confidence to the U.S. economy.

Although the counter-crisis measures are taken by the various countries with the developed economies, but the most-benefiting currencies are the dollar and the Japanese yen, which offer the lowest yield and risk among the major currencies.

It looks like United States are ready to go with stimulating the economy as far as it will be required by the current money-market conditions. In his testimony to the House Budget Committee Ben Bernanke said that the measures to provide credit to the consumers, homebuyers and other borrowers should be considered.

EUR/USD fell from 1.3331 to 1.3261 as of 7:38 GMT today, declining for a third day. GBP/USD also went down today but at lesser extent — from 1.7147 to 1.7117. USD/JPY declined, marking the strength of the yen, from 102.06 to 101.05.

The Japanese yen fell today against the high-yielding currencies (including the Forex majors) after the bank-rescuing measures of the various global central banks helped to cut the inter-bank money-market interest rates.

The South Korea’s measures to provide $100 billion guarantee on the domestic money market helped to ease the debts of the financial companies in the Asian region. The support of the liquidity offer from the U.S., European Union and Asian central banks helped to reduce the demand for the credit money and pushed treasuries and bonds down.

The trend for the strong yen-buying positions will diminish temporarily as the risk-aversion has not enough influence among the traders and more risky assets look highly attractive at the current rates. The fall in the short-term rate and the global volatility will keep yen down for now.

Jean-Claude Trichet, the President of European Central Bank, asked the banks yesterday to start lending the money to each other and the real economy sector after the central bank pumped liquidity into the financial system. If that really worked to reduce the of trust among the banks, the yen may become a less favorable currency in a long term.

USD/JPY rose from 101.62 to 102.00 as of 8:25 GMT today with a daily maximum at 102.41. EUR/JPY rose from 136.24 to 137.49 with a daily maximum at 138.56. GBP/JPY went up from 175.86 to 178.21 today.

The Japanese currency fell for a third day today after the investors gained more confidence that the governments of the developed countries will bailout the troubled banks and will pour out liquidity into the financial markets as needed.

Australian Prime Minister Kevin Rudd said that the government will spend more than $7 billion to the households to support spendings and mortgage payments. U. S. Treasury will buy stakes in the country's largest banks, while the European governments will offer $1,8 trillion in loans to their troubled banks.

The world's monetary authorities are trying to support the economy. This effort can only give traders more confidence. And with more confidence traders tend to forget the risk-aversion. Many interesting assets became so cheap in value in U.S., Europe, Great Britain and Australia, that now traders started to convert from the safe yen to other currencies to buy those assets.

USD/JPY rose from 101.98 to 102.39 as of 8:21 GMT today showing the fourth day of growth. EUR/JPY rose from 138.68 to 139.86 — its second gaining day. GBP/JPY went up today from 177.54 to 179.66, advancing for a third day. AUD/JPY gained from 71.13 to 72.78 today — its second day of growth.