Coming of age of the Yen

The Yen has it seems come of age. Belying market predictions of going to 92 and 80 levels(yes its true, some top shot Tokyo trader predicts so) it has sustainably kept itself above the 95 levels and now managed to jump to the 101-103 zone. Though if I were to believe my instincts, it should again test the 100 levels and possibly slide below silently in the next few weeks. Mark my words, "There is more dirt in the subprime closet than we have been told."

About the Euro, I wash my hands off. It has gone and gone and gone on to levels we had never imagined a year ago....rather few months ago too. 1.60!!! what levels to achieveif it does..... I tend to agree with people who say it may keep testing this level for some time now. 1.62 (and perhaps 1.63) is never out of range but 1.50 is history. Amen.

The INR has in the meanwhile kept its head above the 40 levels after the 3rd week surge to 40.80 that I had been talking of, since ages. I still tend to believe it will continue the good work (look out for the footnote) in the wake of the surging oil prices and despite the run on it by the exporter community which I believe may not impact it by more than 10to 20 paise in absolute terms. Though the slumping below 40 convincingly is also a certainity in the coming weeks.

In keeping with my disclosure last month on my personal interest in the Yen and the Rupee, I am glad that I made comfortable moves if not great. My covering of the USD against JPY was at just above 100 (remember I was not expecting the Yen to strengthen so much so soon!). Also, that I did not wait for better rates on the Yen had majorly to do with the fact that I had a rupee leg to cover after I covered the Yen one and the Rupee had Weakened to my desired levels. And I didnt expect it to weaken further and IT REAFFIRMED MY BELIEF IN the pair. Thus my deal on the INR against USD was done near 40.78 . So you see now, I only said (and did) things that I believed in. And in the hindsight now, I feel I got myself a good deal.