AUDJPY definition

AUD/JPY is the exchange rate between the Australian dollar and the Japanese yen, showing how many yen one Australian dollar will buy. It is a cross pair, meaning it leaves the US dollar out entirely, and it is one of the market's most watched risk barometers. Liquidity is good for a cross, though spreads run a little wider than on the dollar majors.

The Australian dollar is the base currency and the yen the quote currency, so a quote of 99.00 means one Australian dollar buys 99.00 yen. A rising price means the Aussie is strengthening against the yen, a falling price the reverse. You trade AUD/JPY as a forex CFD, betting on the rate rather than holding the currencies: go long if you expect the Aussie to rise, short if you expect it to fall. Because the yen is the quote currency, a pip here is the second decimal place (0.01), and your profit or loss is the pips moved multiplied by your position size.

AUD/JPY is the classic expression of risk appetite in the currency market. The Australian dollar is a growth- and commodity-linked currency that rallies when investors feel bold, while the yen is a safe haven and a favourite funding currency for carry trades, so it strengthens when nerves take over. Add the gap between the Reserve Bank of Australia and the historically ultra-loose Bank of Japan, plus Chinese demand for Australian commodities, and the pair tends to climb in risk-on phases and tumble when markets turn defensive.