New Crisis, Record Yen Still Possible After Bailout, BTM Says

Europe’s unprecedented lending package to debt-ridden nations hasn’t eliminated the chance of a new financial crisis, which may drive the yen to 80 versus the dollar and euro, according to Bank of Tokyo-Mitsubishi UFJ Ltd.

There remains a 10 percent chance of renewed turmoil, said Kazuto Uchida, chief economist at the unit of Japan’s largest banking group, Mitsubishi UFJ Financial Group Inc. Under this scenario, the credit ratings of Spain and Italy would be cut to near junk level, with losses spreading to banks in Germany, France and the U.K.