Focus Yen

Economic outlook for China, U.S., considered leading force in world economy, still key focus for markets, rather than S&P's cut to Japan outlook, says senior market economist. USD/JPY last 89.63, almost same levels before S&P's decision came earlier; pair hit 90.45 after S&P's remarks. Says "yen-selling caused by S&P's decision was largely limited. JGB players -- mostly Japanese -- are not in a rush to buy overseas assets for a flight-to-safety by selling (our own) country's debt and the yen." Amid uncertainty over possibility of China's additional monetary policy, U.S. banking regulations proposed by Obama administration, "investors are not in a position where they want to sell the yen, considered now as a safe haven." Says attention rather on how China, U.S. economic conditions will affect stock, currency markets down the road.