NEW YORK (TheStreet) -- The Japanese yen could suddenly spike against a broad range of currencies, according to HSBC.

Over the last few days, the yen has strengthened as the USD/yen drops on the repatriation of funds by Japanese investors in expectation of big rebuilding activity in their country after a massive earthquake and tsunami.

"We believe the Bank of Japan/Ministry of Finance could intervene in the FX market if the Japanese yen moves become too disorderly," the HSBC Global Currency Strategy Research Team said in a report.

"However, we have to be aware of the idea that the FX market has responded with a lag in the past and the

yen could make a very abrupt move higher against a broad range of currencies."

HSBC analysis shows that the U.S. dollar/Japanese yen took about two weeks to significantly fall on crises such as the 1987 stock crash and the demise of Lehman Brothers during of the recent financial crisis.

The research team said, however, that if the yen's safe-haven currency status eroded, money could flow to the Swiss franc and Norwegian krone.

In turn, the U.S. dollar could benefit by default if liquidity constraints started to show in the Swiss and Norwegian currency markets.

The U.S. dollar was down 1% against the Japanese currency at 80.773 yen Tuesday morning.

CurrencyShares Japanese Yen Trust

(FXY) - Get Report

was rising 1% to $122.08 and

PowerShares DB US Dollar Index Bullish

(UUP) - Get Report

was up 0.4% to $22.

Japanese companies extended losses on Tuesday amid forced plant shutdowns and strength in the local currency, which eats away at corporate profits in this big-exporting country. Diversified manufacturer

Sanyo Electric


was tumbling 7.9% to $6.16, imaging company



was losing 6.9% to $28.40, office equipment maker



was surrendering 9.9% to $54.34, auto parts maker



was down 2% to $15.57 and electricity generation systems and electronics company


( HIT) was falling 6.4% to $46.76.

>>Search for Highest Dividends by Rate or Yield

-- Written by Andrea Tse in New York.

>To contact the writer of this article, click here:

Andrea Tse


>To follow the writer on Twitter, go to

Andrea Tse


>To submit a news tip, send an email to:


Copyright 2010 Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.