Company: FXY
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000950170-25-027263
Chunk: 31

Company: Invesco CurrencyShares Japanese Yen Trust
Filing Date: 2025-02-26
Form: 10-K
Item: Item 1B
Chunk 31
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 pay the accrued Sponsor’s fee for the previous month plus other Trust expenses (including, without limitation, expenses resulting from negative interest rates), if any. When the interest deposited, if any, exceeds the sum of the Sponsor’s fee for the prior month plus other Trust expenses, if any, the Trustee converts the excess into USD at the prevailing market rate and distributes the USD as promptly as practicable to Shareholders on a pro-rata basis (in accordance with the number of Shares that they own). The Trust did not pay any distributions during the year ended December 31, 2024. 

Results of Operations 

During the years ended December 31, 2024 and 2023, the Trust's net comprehensive income (loss) was, in part, impacted by market volatility resulting from expectations around the Federal Reserve (the “Fed”) easing and heightened geopolitical concerns for 2024, and the US banking sector turmoil for 2023 which are considered to be unusual or infrequent events. Although the full and direct impact of Fed easing expectations, rising geopolitical tensions, and the US banking sector turmoil on the Trust's net comprehensive income (loss) during the years ended December 31, 2024 and 2023 cannot be known, it is believed that they have each independently impacted the Closing Spot Rate, the interest rate paid by the Depository, and the global economy and markets generally, including the number of Shares created and redeemed by the Trust.

Despite the strong rally in the third quarter, the Japanese yen (JPY/USD) still ended 2024 sharply lower. The pair was heavily pressured in the first half of the year, with prices sliding to the weakest level against the US dollar in over three decades as the BoJ stayed committed to its ultra-loose monetary policy, while the Fed kept on with its higher-for-longer rhetoric amid sticky US inflation. However, the pair managed to make a strong comeback in the third quarter, erasing most of its previous losses, with the surprise Japanese rate hike in July boosting the yen, while the kickoff of the Fed’s easing cycle and other US macro concerns pressured the dollar. That said, all those gains were erased in the fourth quarter as Trump’s victory sent the greenback skyrocketing. Many of the president’s campaigned policies were expected to raise inflation risk, potentially leading to higher rates in 2025. In addition, tariffs generally weigh on foreign currencies, further boosting the USD. 

The Japanese yen (JPY/USD) continued its decline in 2023