Timing Right for New Yen ETF

Jesse Emspak of the IBD reports that Rydex Investments has launched a Japanese yen exchange-traded fund or ETF (FXY), the latest of eight that the firm offers to advisers. The other ETFs offered track the euro (FXE), the British pound (FXB), Swiss franc (FXF), Swedish krona (FXS), Mexican peso (FXM) and Canadian (FXC) and Australian dollars (FXA). Rydex also offers a mixed foreign currency ETF. All of the currency ETFs invest via demand deposit accounts.

Japanese interest rates are still low very low relative to Europe and America with the Bank of Japan rate at about 0.25% and 10-year notes at 1.7%. Chartwell ETF Advisors expects that the benchmark rate will increase to 0.50% in March.

Any rebound in the Japanese economy could strengthen the yen and an announcement is expected next week that GDP growth in the 4^th quarter of 2006 was a surprising 3.5%.