Japanese Yen ETFs Face Major Headwinds | Page 2 of 2 | ETF Trends

“If U.S. rates fully normalize over a three-year period (fed funds near 4 percent by early 2018) and Bank of Japan rates still are at zero, you could perhaps see dollar-yen at 140,” Ruskin added.

Moreover, Investors could magnify the sell-off in yen and demand in the U.S. dollar as more people capitalize on the carry-trade – investors purchase higher-yielding currencies with higher interest rates, like the dollar, by selling lower-yielding currencies, like the yen. Kathy Lien, longtime forex strategist who started BK Asset Management, argues that the environment is “the perfect backdrop for carry trades to return.”

ProShares UltraShort Yen

For more information on the yen currency, visit our Japanese yen category.

Max Chen contributed to this article.