Report On Foreign Exchange Market Of Japan

2238 words - 9 pages

Report on Foreign Exchange market of JapanTable of Contents3Executive summary 4Introduction 5Foreign Exchange Market of Japan 5Fluctuation in Yen "between" 2007-2009 9Determinants of Currency movements 12Forecasting Japanese currency Yen over 2010 14Conclusion 15References Executive summaryThis report provides an in depth analysis of Forex market trend of the Japan especially from 2007to 2009. The Forex market of Japan is very volatile i.e. exchange rate of Yen fluctuates against the other country's currency significantly over a period of time. In this research, it is also discussed that how the different determinates create impact on exchange rate of Yen. The forecasted exchange rate of Yen is calculated with the help of past trend of the exchange rate of Yen. Forecasted exchange rate of Yen effectively helps to identify the trend of future Forex market of Japan.IntroductionThe foreign exchange market is a market where currency is traded. Over the years, the foreign exchange market has emerged as one of the largest market in the world. The foreign exchange market is largely an over-the-counter market i.e. all trades are executed between exchange members. In the foreign exchange market, the traders include large banks, central banks, currency speculators, corporations, corporations, governments, and other financial institutions.In foreign exchange market at retail level, travelers and tourists exchange currency in the form of currency notes or travelers' check. Retailers buy and sell currency from the banks and other institutions. At wholesale level, the participants are commercial banks, investment banks, corporation's banks and central banks. The wholesale market is also called interbank market. In this market transaction volume is very large (Bradstreet & Dun 2007).In the world, every country has its own foreign exchange market. Japanese foreign exchange market is second largest market in the world. The participants of Japanese foreign exchange market are Japan's commercial banks, city banks, big securities houses, insurance companies, trading companies and industrial group. In this market the participants are mostly Japanese. In the Foreign exchange, full liberalization policy was announced in 1998 by the Japanese government. The impact of this liberalization was that many other direct players entered in the Japanese foreign market and the currency trading volume rose significantly (Reszat, 1997).Foreign Exchange Market of JapanThe foreign exchange rates in Japan are dependent on the exchange rate of Yen with the other foreign currencies of the world. In 1973, Japan government allowed the floating foreign exchange rate system. After this, foreign exchange market of Japan became volatile with regards to the currency exchange rates. For eliminating the negative fluctuations, banks of Japan controls over the foreign exchange market of Japan (Foreign Exchange Market Japan, 2010).Fluctuation in Yen "between" 2007-2009At present, the exchange...

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