The AUD/JPY spot figure informs currency traders of the amount in Japanese yen they can acquire with a single Australian dollar.
Currently the fifth most traded currency on foreign exchange markets, the Australian dollar is often referred to as the "Aussie". AUD/JPY is known as a cross currency pair in trading circles, as it does not involve the US dollar.
The Australian dollar is traditionally a popular choice for traders due to the nation's comparatively high interest rates, the freedom of its money market from state intervention and the general stability of the Australian economy.
Like other currency pairs - for example, USD/JPY - the AUD/JPY pair is often associated with the carry trade.
This term refers to a popular trading strategy in which speculators borrow low-yielding currencies and invest in those with a significantly higher yield.
With interest rates kept low by the Bank of Japan for many years and the Reserve Bank of Australia setting rates much higher, traders could sell heavily in yen to buy the Australian dollar.
However, the use of the carry trade declines during global liquidity shortages. This proved to be the case in the aftermath of the global economic crisis in 2008, with the value of the yen appreciating considerably.
The Australian dollar has a greater correlation with commodities than most other currencies, which means AUD/JPY traders must also take changes in this area into account.
In particular, the evolution of the gold price can have a significant impact on AUD/JPY. Australia is the world's third largest producer of gold and the Australian dollar has an 80 per cent positive correlation with the precious metal.
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