- Title: Japanese market reacts to gains in Sterling after British PM Brexit speech
- Date: 18th January 2017
- Summary: TOKYO, JAPAN (JANUARY 18, 2017) (REUTERS) STAFF WORKING AT GAITAME.COM, A FINANCIAL FUTURES TRANSACTION COMPANY OFFICE EURO/YEN RATE SHOWN ON ELECTRONIC MONITOR STAFF WORKING EURO/YEN RATE SHOWN ON ELECTRONIC MONITOR ELECTRONIC TICKER SHOWING FOREIGN EXCHANGE RATES (SOUNDBITE) (Japanese) FOREIGN EXCHANGE ANALYST, KANDA TAKUYA, SAYING: "The Brexit decision will only be announced after it is approved by the British parliament. That is why the market has taken that to mean there is a slightly-lowered risk of a sudden and forced exit, and the pound is rebounding after May's speech." ELECTRONIC MONITOR SHOWING EURO/YEN RATE (SOUNDBITE) (Japanese) FOREIGN EXCHANGE ANALYST, KANDA TAKUYA, SAYING: "However, the risk of the U.K. being burdened with economic disadvantages once it does exit, will be an ingredient for a stronger yen based on risk-aversion." STAFF WORKING EU AND AMERICAN FLAG DISPLAYED
- Embargoed: 1st February 2017 04:06
- Keywords: market yen pound sterling Euro Nikkei stock dollar brexit European Union Japan Tokyo
- Location: TOKYO, JAPAN
- City: TOKYO, JAPAN
- Country: Japan
- Topics: Economic Events
- Reuters ID: LVA0015ZLXC1X
- Aspect Ratio: 16:9
- Story Text: The safe-haven yen appreciated along with the British pound on Wednesday (January 18), after British Prime Minister Theresa May promised a parliamentary vote on Britain's deal to leave the EU on Tuesday (January 17), seeking to draw a line under the discussion of a "hard" or "soft" Brexit.
The gain in Sterling was the biggest daily rise since at least 1998.
It was trading at 1.2392 against the dollar, and at 120.85 against the yen in early Asian hours after surging 2.9 percent to a 10-day high in the previous session.
"The Brexit decision will only be announced after it is approved by the British parliament. That is why the market has taken that to mean there is a slightly-lowered risk of a sudden and forced exit, and the pound is rebounding after May's speech," said Takuya Kanda in Tokyo, a foreign exchange analyst at Gaitame.com.
"However, the risk of the U.K. being burdened with economic disadvantages once it does exit, will be an ingredient for a stronger yen based on risk-aversion," Kanda added.
Japanese top government spokesman Yoshihide Suga said at a daily news conference that Japan will keep a cautious eye on talks especially because considering the many Japanese companies based in Europe including the U.K.
"We want to minimize any impact on the world economy, and the work of Japanese companies, so we will continue to take any necessary action toward the U.K. and the EU."
The wider Japanese stock market along with the Nikkei 225 was slightly down yesterday (January 17), but picking up after hitting its lowest levels since December, as investors braced for May's speech and Friday's (January 20) inauguration of U.S. President-elect Donald Trump.
The Nikkei stock average opened at 19,393.60 down 66.36 (0.34 percent) from the previous day. - Copyright Holder: REUTERS
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