Japanese yen stages recovery as short positions unwind
The Japanese yen is rebounding strongly against the dollar and other major currencies as shifting central bank policies and capital repatriation force short speculators to rethink their strategies. Growing expectations of a Bank of Japan rate hike and unwinding carry trades are helping drive the currency higher.
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The Japanese yen surged 2% against the greenback this week, putting Japan's currency on track for its best performance since July's joint intervention by Tokyo and Washington. The sudden rally is forcing bearish traders to unwind long-held short positions against the USD/JPY pair.
