Another devastating year for the Japanese currency is coming to an end. Despite mounting a comeback in recent months, the yen is still on track to close the year with losses of around 8% against the US dollar, mostly because of the Bank of Japan’s refusal to raise interest rates. Indeed, the latest recovery in the yen has been driven mostly by speculation that foreign central banks in the United States and Europe will slash interest rates aggressively next year. Hence, currencies like the dollar and the euro have lost some of their interest rate advantage over the yen. Despite a streak of high inflation readings, the ... (full story)