OJ would follow the idea of expanding the yen supply. The BOJ is conducting a survey on Monday Oct. 4 to see how optimistic business sentiment is as the economy tries to rebound. The yen could rise this next week to its highest level since that 1995 value of 80/$.The closing value for the yen on Oct. 8 jumped up to 107.6000/$. The Japanese economy is still at the mercy of the strong yen although it has depreciated a little from last week because the economic recovery is strong enough for now to keep the yen from rising in value. The BOJ ran its quarterly survey, the TANKAN survey, which showed a strong rise in optimism among the big manufacturers about their business outlooks. Despite this optimism, there is still room for concern on the yen and for the economy. Businesses are having to cut jobs, increasing unemployment, which in turn will decrease consumer spending. The strength of the yen is making the Japanese exports worth less as the foreign currencies when payments are converted back to yen and is also making imports cheaper which will add to deflation. The government is till pushing for the BOJ to increase the yen supply or do some kind of monetization, but BOJ is still unwilling this week.The BOJ decided Wednesday October 13 to keep its soft monetary policy, but it said that it would expand its range of market operations to try and make its policy more effective. The BOJ decided to begin buying short-term government securities as a new way of supplying yen to the money markets. The market had expected no change so the yen fell by more that half a yen to the dollar after the announcement. The government has lessened its urgency of the BOJ to increase money supply. Now it is putting together an economic package to stimulate the economy. In order to do this, it needs the BOJ to adopt a zero interest-rate policy for the short term borrowing it needs to finance the package. By the week's end, the dollar began falling in value r...
