REUTERS/Shohei Miyano/Illustration/File Photo

On June 13, the exchange rate of the yen against the U.S. dollar once fell below the 135 yen to one dollar mark, hitting a new low in about 24 years. The Japanese stock market also suffered a large decline, with the Nikkei 225 index closing 3.01%.

Since the Russian-Ukrainian conflict broke out this year, the yen has become one of the world‘s most depreciated currencies. The depreciation of the yen against the dollar was also significantly higher than the rise in the dollar index over the same period.

The Bank of Japan’s insistence on an ultra-loose monetary policy is the core reason for the yen’s continuous decline.

Monetary policies in major developed countries have been tightened, and actual and expected interest rate differentials between Japan and other major economies have continued to widen. Especially after the Fed started raising interest rates in March and released a signal of accelerated tightening, the yield of US bonds rose rapidly, and the depreciation of the yen intensified.

Japan and Europe are two typical economies that implement negative interest rates. The European Central Bank has decided to start raising interest rates in July this year, and it is expected that negative interest rates may be withdrawn by the third quarter of this year.

However, the Bank of Japan’s monetary policy has yet to see signs of tightening.

Comments are closed.

You May Also Like

Fitness Club Shut Due To Coronavirus Fears

despite a requirement (for) self-quarantine … club member chose to visit the Yawei fitness club

Taiwan to Impose Health Declaration Forms on All Visitors

Those failing to accurately do so face a fine of up to NT$150,000

Despite Trade War, Taiwan Raises Economic Forecast For 2020

The ongoing US-China trade war seems to be impacting everyone, except perhaps…

In Taiwan, Southeast Asians Find Roots In A Bookstore

Humans often tend to create and sustain differences between each other. In…