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|
|Contract Month Listings||Six months in the March quarterly cycle (Mar, Jun, Sep, Dec)|
|Settlement Procedure||Physical Delivery|
Daily FX Settlement Procedure
Final FX Settlement Procedure
|Position Accountability||10,000 contracts|
|Ticker Symbol||CME Globex Electronic Markets: 6J|
Open Outcry: JY
AON Code: LJ
|Minimum Price Increment||$.000001 per Japanese yen increments ($12.50/contract). $.0000005 per Japanese yen increments ($6.25/contract) for JPY/USD futures intra-currency spreads executed on the trading floor and electronically, and for AON transactions.|
|Trading Hours||Open Outcry (RTH): 7:20am-2:00pm CT|
|Globex (ETH): 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|
|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).|
|Block Trade Eligibility||Yes.|
|Block Minimum||150 Contracts|
|Exchange Rules||These contracts are listed with, and subject to, the rules and regulations of 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.
Last updated May 2013
Japanese Yen News Articles
- Yen pushes ahead against greenback (3/11/2014) - The monetary unit of Japan rose on Tuesday against the U.S. dollar after the central bank of the South Pacific nation opted to leave monetary policy unchanged, Reuters reports.
- Yen rises after China posts weaker export data (3/10/2014) - The Japanese yen increased in value on Monday against the world's reserve currency, prompted higher by concerns about an economic slowdown in China, according to Reuters.
- Yen loses value against U.S. dollar (3/6/2014) - The Japanese yen dove to its lowest value in nearly two weeks on Thursday against the world's reserve currency after advisors noted the increased pace of inflation permits the pension fund of Japan to cut down on reliance on domestic bonds, according to Bloomberg.
- Yen falls against dollar, euro as Russia, Ukraine cut tension (3/5/2014) - The Japanese yen dipped on Wednesday against the world's reserve currency and the common currency of the European Union amid a détente between Russia and Ukraine, according to Reuters.
- Yen dips as Russia halts training (3/4/2014) - The Japanese yen dove the most since the middle of last month on Tuesday against the world's reserve currency as Russia reportedly toned down military training in its western region, tugging down demand for assets considered safe-haven assets such as the yen, according to Bloomberg.
- Yen rises as concerns grow about Ukraine (3/3/2014) - The Japanese yen climbed on Monday against all 16 of its major rivals amid growing concerns for the stability of Ukraine as Russian troops streamed into Crimea, prompting demand for safe-haven assets to climb, according to Bloomberg.
- Yen pushes up against most top counterparts (2/25/2014) - The Japanese yen notched its top advance in more than one week on Tuesday against the world's reserve currency as confidence grew about the yen being in increased demand as the Chinese yuan struggles, according to Bloomberg.
- Yen moderately gains amid concerns about Chinese property market (2/24/2014) - The monetary unit of Japan edged up in value against the world's reserve currency on Monday, falling under increased demand after China released underwhelming economic data about housing prices, according to Reuters.
- Greenback rises against yen (2/21/2014) - The U.S. dollar advanced on Friday against the Japanese yen, prolonging its largest weekly climb thus far this year against its cross-Pacific rival, according to Bloomberg.
- Yen surges against top rival currencies (2/20/2014) - The Japanese yen marked its top gains in about two weeks against the world's reserve currency on Thursday after Chinese economic data noted slower factory production this month, Bloomberg reports.
Japanese Yen Blog Posts
- Market Spotlight: US Dollar Index (10/10/2012) - The two key factors affecting a currency’s value are central bank monetary policy and the trade balance.
- The US Dollar and Inflation (9/28/2012) - The US Dollar Index is a measure of the value of the United States Dollar compared to a basket of currencies weighted accordingly: Euro 57.6 % weight Japanese yen 13.6 % weight Pound sterling 11.9 % weight Canadian dollar 9.1 % weight Swedish krona 4.2 % weight Swiss franc 3.6 % weight The US Dollar... Read More.
- Using Fibonacci to Find Trend Continuation Entries in Currency Futures (8/16/2012) - Currency futures can be a challenge to trade. Unlike some markets that see their best liquidity (and often the best moves) during US trading hours, currencies can see action almost any time of the day or night, and some of the best moves can occur when the "home market" is open-during Tokyo trading hours for the Yen or European hours for the Euro, Pound and Swiss.
- Market Spotlight: British Pound (7/11/2012) - The British Pound (or pound sterling) is the world's oldest currency still in use dating back to Anglo-Saxon England in the middle 8th century. It's the official currency of the United Kingdom, its Crown Dependencies, and the British Overseas Territories.