Asian markets fall on US worries (BBC) {new low vs ¥}

[eppur_se_muova]

Asian stock markets have fallen sharply as investors continue to worry about a possible US recession.

The main indices followed the US markets where there were big falls on Wall Street on Friday.

Tokyo's Nikkei index closed down 4.5%, or 610.84 points at 12,992.18, its lowest level for six weeks.

The decline of the dollar against the yen also worried traders. Shares of big exporting companies such as Toyota and Honda suffered large falls.

The weakening dollar fell to its lowest level against the yen for three years, making exports more expensive. In early trading in Tokyo it was as low as 102.90 yen. It later recovered to 103.20 yen.
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more: http://news.bbc.co.uk/2/hi/business/7274309.stm

[Art_from_Ark]

1. Not exactly a new low versus the yen

It's actually just a 3-year low.

To reach a new low, the dollar would have to fall below the 78-yen level.

[fasttense]

2. Give it time.

With the promised rate cuts from the Fed and the continuing US stagflation, eventually the dollar will decline even more. It's what the bushes always wanted - a weak dollar.

[Art_from_Ark]

3. The bu$hes might want a weak dollar,

but Japan doesn't want an excessively strong yen. When the yen reached its all-time high in 1994, it killed a lot of smaller export companies and caused major league headaches for the larger ones. The Japanese government's threshold of pain before it started buying up dollars last time (3 years ago?) was the 102 yen/dollar level. I have a feeling that the Japanese government will do what it can to keep the dollar at least above the 100 level.