This chart showing us how market react to earthquake back in 1995 when a 7.3 quake hit the coastal city of Kobe, Japan. Japan’s currencies surges, Nikkei fell.
Major Currency reaction from day earthquake hit Kobe January 1995 until April 1995
the only diffrence, interest rate on that time was about 1.7++ , but now their current interest rate at nearly zero.
Will USDJPY range between 79.35-85.90 or it will break lower?
MARCH 12, 2011
Yen Gains as Nikkei Falls 1.7%
Japan’s currency surged, largely on hopes that Japanese insurance companies and other businesses would be forced to repatriate money held overseas to buy yen for repairs needed at home.
The dollar dropped 1.3% to 81.89 yen.
The Nikkei Stock Average fell 1.7% to 10254.43, its lowest close since Jan. 31. The Hong Kong Hang Seng index fell 1.6%, and South Korea’s Composite index fell 1.3%.
Even before Friday morning’s quake, Asian markets had been under pressure on global growth concerns and disappointing economic data from China. The Nikkei’s two-day selloff, down 3.2%, has been the worst since August.
U.S. stocks, in contrast, shook off the disaster and ended the day strong, though still lower on the week. The Dow Jones Industrial Average rose 0.5% to 12044.40. The Standard & Poor’s 500-stock index rose 0.7% to 1304.28. The Nasdaq Composite index rose 0.5% to 2715.61.
The damage to Japan’s nuclear facilities could increase its appetite for imported natural gas to replace idled electricity generation. The price of LNG on the Asian spot market on Friday rose 50 cents to $9.900 a million British thermal units, a 5% increase, according to Platts.
Source : The Wallstreet Journal – http://on.wsj.com/gOsaC9
Will The effect be the same as before?