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USDJPY or USD/JPY is the abbreviation used for the pair of currencies made up of the United States Dollar and the Japanese Yen. Colloquially, it’s often referred to simply as trading the “yen” (though of course, the yen trades with other currencies as well). The value indicates how many yen (the quote currency) are needed to buy a dollar (the base currency).
Characteristics of the pair
The USDJPY is one of the top-five most traded currency pairs and among the most liquid. The currencies represent the countries with the largest and third largest economies in the world; America’s $18.6 trillion economy added to Japan’s $4.9 trillion represent 30% of the world’s total economy.
Because of the long-standing fiscal policies of both countries, both currencies are seen as “safe havens”; in times of economic uncertainty, investors and traders will move their assets into dollars and yen for safe keeping. This means that both currencies can be stre...
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