Moscow Exchange will stop trading in Yen on Aug 8, cites risks
Due to risks of miscalculation amid an unstable Yen, trade will stop on August 8.
The Moscow Exchange (MOEX) will suspend the Japanese Yen trading on August 8 due to risks and difficulties in making calculations.
"On August 8, 2022, the Japanese yen trading will be suspended on the Moscow Exchange currency market … From August 8, the Japanese Yen will also not be accepted as collateral for transactions on the markets of the Moscow Exchange. The suspension of operations is due to potential risks and difficulties in making calculations in the Japanese yen," the Moscow Exchange said in a statement.
Japan's currency has been depreciating against the US dollar, reaching a 24-year-low as of last month. At home, the country has also been dealing with soaring price hikes with the unstable economic situation.
Last month, the Japanese yen sold at the lowest price against the US dollar for the first time since 1998, as the United States is battling soaring consumer prices, one of whose repercussions has been a widening monetary policy gap between Japan and the US.
The yen has been in freefall for months, especially in light of the Fed aggressively hiking interest rates to try and mitigate the soaring inflation. The current financial situation is expected to maintain its momentum through the coming period as the US grapples with several issues, including the sanctions on Russia that have been causing supply cuts, surging gas prices, and rising food prices.
The Bank of Japan said it would adhere to its long-standing monetary easing program, which it hopes would lead to stable growth, a step that goes against what the Fed is doing at home.
The contradicting policies have given the USD a lot more ground against the Japanese currency, with the former buying 135.19 yen. This beats the former record of 126 yen on the dollar, which was the Japanese currency's lowest since 2002.
This high rate has not been seen since the 1998 Asian currency crisis, and it marks a dramatic drop from the record-high January rates of around 115 yen per USD.