Japan institutional investors start unwinding dollar/yen hedge after steep yen drop

Tax burden falling

Japanese life insurance firms have started to unwind their dollar/yen hedges in the wake of the yen's sharp depreciation over the last month, according to market sources.

The Japanese yen has plunged by more than 12% against the dollar since November last year, accelerated in part by the Bank of Japan's recent decision to increase its target inflation rate from 1% to 2%. The easing crisis conditions in Europe and the avoidance of the US financial fiscal cliff were also cited as factors leading

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