Exchange Rate in Japan
Japan - Exchange Rate (average of period)
Trump’s victory and Fed’s hike prompt sharp depreciation of yen
The Japanese yen (JPY) has been depreciating sharply against the U.S. dollar since Donald Trump’s victory in the 8 November presidential election and, in particular, following the United States Federal Reserve’s decision to raise its benchmark interest rate at the 13–14 December meeting. On 15 December, the JPY marked the weakest reading since February this year; it traded at JPY 118.2 per USD. This was 8.2% weaker than the level observed on the same day in November. That said, on an annual basis, the Japanese yen still gained 2.9% against the greenback.
The sharp weakening of the yen mostly reflects expectations that Trump’s policies will boost growth in the world’s largest economy via stronger fiscal stimulus and that the Federal Reserve will have to hike rates, thereby widening U.S.–Japanese interest rate differentials. This situation contrasts with the dynamics observed earlier this year, where rising risk aversion due to an uncertain global outlook had led the yen to strengthen to a nearly three-year high.
If sustained, the depreciation of the yen could cause a rebound in exports, translating into an improvement in businesses’ earnings, higher inflation, and stronger investment and manufacturing activity. Nevertheless, Trump’s unclear policy plans will cast a long shadow on the yen’s performance in the coming months.
Met the why particular Consensus Forecast panelists expect the yen to trade at 117.7 per USD by the end of 2017. For 2018, the panel projects that the yen will weaken to 119.4 per USD.
Japan - Exchange Rate (aop) Data
|Exchange Rate (vs USD, aop)||97.63||115.9||121.1||118.8||112.2|
5 years of economic forecasts for more than 30 economic indicators.
Japan Exchange Rate (aop) Chart
Source: Thomson Reuters
|Bond Yield||0.12||-4.41 %||Sep 20|
|Exchange Rate||112.5||-0.35 %||Sep 20|
|Stock Market||23,675||0.11 %||Sep 20|
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September 19, 2018
Nominal yen-denominated merchandise exports increased 6.6% annually in August, accelerating from July’s 3.9% expansion and overshooting market expectations of a 5.3% increase.
September 19, 2018
At its 18–19 September meeting, Bank of Japan (BoJ) board members voted seven-to-two to maintain its monetary policy steady, as expected by market analysts.
September 13, 2018
Core machinery orders, a leading indicator for capital spending over a three- to six-month period, rebounded strongly in July, expanding at the fastest pace since January 2016 and suggesting that capital expenditure will boost overall economic growth further down the road.
September 11, 2018
A second data release showed that the Japanese economy fared better than previously reported on the back of stronger-than-expected investment growth.
August 31, 2018
Industrial production contracted 0.1% on a month-on-month and seasonally-adjusted basis in July, following June’s 1.8% decrease.