Yen's fall may affect car prices in Brunei

PHOTO: Yen's fall may affect car prices in Brunei

THE Japanese yen yesterday slipped to a nine-month low, prompting speculations that car prices in Brunei could fall.

Many Japanese car distributors were unavailable for comment, but an official from the Brunei Automobile Traders Association, who spoke on condition of anonymity, said that Japanese car makers would probably try to offset fluctuations in the value of the yen by raising or dropping prices.

However, he said he could not comment on behalf of Japanese distributors in Brunei.

Yesterday, Reuters reported the yen had slipped to a nine-month low as expectations grew that the Bank of Japan would print more money to stimulate the world's third largest economy after a key election this weekend.

"The market is growing confident the next government will be one of the most aggressive about (monetary) easing that you could think of," said a trader at a Japanese bank.

"Those who had been hoping to buy the dollar/yen on possible dips after the Fed's meeting are now buying the dollar after the dollar didn't fall much," he added.

The dollar bought ¥83.71, having risen to as high as ¥83.95, a level not seen since its March peak of ¥84.187.

The euro also rose to an eight-month high of ¥109.63, and was on track to end the week almost 3 per cent higher against the yen.

The Bank of Japan's tankan survey showed that Japanese business sentiment had worsened, bolstering expectations that the central bank would take fresh easing steps at its policy meeting on Wednesday and Thursday.

"We forecast more yen weakness in 2013.... Eventually, the yen must weaken because the economy needs help so badly," said Kit Juckes, strategist at Societe Generale in London.

In 2010, the Japanese yen hit a high that drove car prices up by at least US$1,000.