Will Obama's Support Affect the Yen?

President Obama met with Japanese Prime Minister Naoto Kan on Thursday, pledging that the United States would do all it could to support the Japanese rebuilding efforts, according to Reuters. Japan has been devastated by disasters in recent months. The island nation was first hit with tsunamis in March; that led to an issue over the safety of nuclear reactors--an issue the country is still struggling with months later. Following the initial disaster, the Japanese yen spiked in value against other world currencies, as investors may have moved to exchange their Japanese assets for yen. As Japan is an export-led economy, concerns over the strength of the yen detrimentally affecting the economy led the Japanese Central Bank to intervene in the markets in an effort to weaken the yen. Obama's decision to support the Japanese may be bullish for the Japanese economy. Traders looking to play a Japanese rebound might consider iShares MSCI Japanese Index Fund EWJ. In terms of its currency, it appears that the Japanese believe it is in their interest to keep the yen weak. Traders may look to ProShares UltraShort Yen YCS if they believe the Japanese will be successful in that endeavor.