A strategy for yen appreciation

BACKGROUND: So far in 2005, the yen has traded in a range of 103 to 116 against the US dollar. However, the strongest levels for the yen were seen at the start of the year; more recently, it has been trading at the lower end of this range. But our view is that the currency will soon strengthen, perhaps before the end of 2005.

PROBLEM: It may seem strange to be writing about a strategy for yen appreciation against the US dollar when it has been depreciating so much in the past few months. But the

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