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To: Les H who wrote (500)	8/14/2001 12:11:18 PM
From: Les H	Read Replies (1) \| Respond to of 29592

Surprise rate cut by Japan msnbc.com also on yen repatriation: Supporting the yen at the moment are repatriation flows, which drove the currency to one-month highs against the dollar this week. Japanese institutions, rushing to show profits ahead of a September 30 accounting change, have been bringing home funds amid falling equity prices. The "mark-to-market" rule will force them to price their assets at fair value and exporters have been taking advantage of the yen's recent strength to bring back overseas earnings at this time. Therefore, repatriation is beating out the negative aspects of today's move by the BoJ. Also helping the yen today was a late rally in the Nikkei, helping it to end up 3.84% at 11,917. The BoJ's move increases the deposit target supply by 20%, but the effect on the economy may be minimal due to the lack of demand in Japan. Yet, even though the policy change will have little positive impact on the economy, it will be interpreted as a sign the Bank is more ready to take radical measures than many had thought. This will help weaken the yen back towards the 124 level after yen repatriation disappears. It will also help divert blame away from the Bank as markets brace for a cruel April-June GDP figure due on September 7. forexnews.com