There is an interesting piece on the Bloomberg wire, reminding us that margin requirements on retail forex trading in Japan will be raised as of August 1. Today, retail investors can use 50 times leverage. That will be halved to 25 times as of Monday.
Japanese retail investors are generally sellers of JPY and buyers of higher-yielding currencies like AUD and NZD. Perhaps the higher margin requirements are prompting position liquidation, though you’d never know it from looking at the AUD/USD and NZD/USD side of the cross, which trade at record highs…
Food for thought…
