Every so often, a market move appears inexplicable. The conundrum now is the yen's strength. Of course, there are numerous attempts shed light on the yen's rise, but many, like ourselves, are not very satisfied.
Perhaps part of the problem is that many participants are looking for a single narrative that explains why the dollar peaked against the yen last June near JPY125.85 and fell to almost JPY107.60 yesterday. However, closer inspection suggests the dollar's decline and yen rise has had several phases.