Japanese Yen Ignores Political Drama, Continues to Rise

Spread betting and contracts for differences on the spot forex market should consider that things are becoming quite interesting in Japan -- and yet the yen continues to strengthen against the U.S. dollar. Indeed, regular considerations related to interest rates and what is happening in other countries is not affecting the yen much right now.

Once again, leadership of Japan's ruling party is being challenged. This time, prime minister Naoto Kan is being challenged by Ichiro Ozawa. There have been several changes to the leadership in Japan in recent years, but this has not served to undermine the yen, as political instability would normally weaken a currency.

Instead, the Japanese yen continues to strengthen against the U.S. dollar on the spot forex market. One of the reasons Kan is being challenged right now is because some feel he is not moving fast enough to intervene in the forex market and encourage yen weakness.

Yen weakness is important to Japan because it gives Japan, a country dependent on its exports, an edge in international trade.