Banking and Finance
Yen trapped between debt downgrade, tighter credit
THE market strategy of ``Buy the rumour, sell the fact'' was very much in evidence this week in the case of the Japanese yen. The currency came under selling pressure from Monday on rumours that the international credit rating agency, Fitch IB CA was about to downgrade Japan's local currency sovereign credit rating but when the announcement did come through on Thursday, the yen actually strengthened to yen 104.40 to the dollar, up almost one per cent from yen 105.57 in late New Yor k trade on Wednesday. This was attributed to a correction of the sell-off in anticipation of the downgrade. Throughout the week, rumours that Bank of Japan (BoJ) is about to tighten interest rates in Japan lent support to the yen.

Forex
Is RBI targeting a downward REER path?
IS the Reserve Bank of India targeting a constant or at least a mildly depreciating REER?

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