Japanese Yen Futures

japanese-yen The Meiji government made the Yen the official Japanese currency in 1871 after years of an overly complex currency system in the Edo period. Yen literally means round object in Japanese. Ever since the Bretton Woods system collapsed and the monetary system switched to floating exchange rates, the value of the Japanese Yen has similarly floated ever since. However, because of its floating exchange rate, the Japanese Yen is considered extremely volatile. The Yen is the third-most-traded currency in the world, most likely due to the fact it is so undervalued compared to the US Dollar and British Pound.

Japanese Yen Contract Specifications
Contract Size 12,500,000 Japanese yen
Trading Hours CME Globex: Sundays: 5:00pm – 4:00pm CT next day.
Monday – Friday: 5:00pm – 4:00pm CT the next day, except on Friday – closes at 4:00pm and reopens Sunday at 5:00pm CT.
CME ClearPort: Sunday – Friday 5:00pm – 4:15pm CT with a 45–minute break each day beginning at 4:15pm
Minimum Price Fluctuation $.0000005 per Japanese yen increments ($6.25/contract) also for JPY/USD futures intra-currency spreads executed electronically.
Product Code CME Globex: 6J
CME ClearPort: J1
Clearing: J1
Listed Contracts Twenty months in the March quarterly cycle (Mar, Jun, Sep, Dec)
Settlement Method Deliverable
Last Trade Date 9:16 a.m. Central Time (CT) on the second business day immediately preceding the third Wednesday of the contract month (usually Monday).
Settlement Procedures Physical Delivery – JPY/USD Futures Settlement Procedures
Position Accountability 10,000 contracts
Block Trade Eligibility Yes.
Block Minimum 150 Contracts
Exchange Rules These contracts are listed with, and subject to, the rules and regulations of CME.
Source: CME

Japanese Yen Facts

Japanese Yen futures allow traders to assess value against the U.S. dollar, as well as the opportunity to address risk from currency fluctuations in other foreign trade markets.

Currency rates are determined by a one base currency quoted in relation to a different currency. Major currencies that are traded are floating. Central bank monetary policies can affect the value of currency. The Bank of Japan regulates monetary policy for its currency. For instance, low interest rates dictated as policy can be bearish for currency value because new money is being pumped into the market. This is unappealing to foreign investors because returns yield those low interest rates. In contrast, high interest rates set as policy are bullish and appealing to foreign investors because of high interest yields from the returns. Currency values can be also be affected by the nation’s current account balance. An excess or influx in the balance is considered to be bullish, while a deficit or drainage is considered to be bearish. Economic stability and investment in the country also help strengthen currency values because international investors are likely to buy into that country’s favorable markets.

Source: Barchart

Last updated September 2015

Additional Info

Recent Posts on the Japanese Yen

  • Currencies Commentary for 2015-05-12 (5/12/2015) - With the twin peak investments of US Treasuries and US equities seeing severe technical damage and the latest US scheduled data flow leaving more growth questions than evidence of forward progression, it is not surprising to see the Dollar trading lower.
  • Currencies Commentary for 2015-05-05 (5/5/2015) - The Dollar continues to claw out minor gains overnight but today's initial scheduled data flows aren't expected to provide the Dollar with a distinct lift. In fact, the ISM Non-Manufacturing reading is expected to downtick and that could temper the Dollar's four day rally effort.
  • Pre-Dawn Targeting (1-8) (1/8/2015) - We have a lot to discuss this morning because this Pre-Dawn will cover the balance of the week and most likely Monday. So let's get right to it...