Yen continues fall against dollar amid US bond rise

Tokyo, Apr 15 (EFE).- The Japanese yen continued its decline against the United States dollar Friday and reached a new low not seen in two decades, due to the difference in monetary policies and the rise in American bonds yields.

The dollar was bought at JPY 126.55 in the Tokyo market, its highest price against the Japanese currency since May 2002, accentuating a trend observed in recent weeks.

The yen has lost 10 percent against the dollar since the beginning of March, generating concern in Japan due to its foreseeable impact on the country’s trade balance in the current situation of global inflation.

The yen devaluation comes in the context of monetary easing applied by the Japanese central bank for almost a decade, contrasting with a strengthened USD after the interest rate hikes announced by the US Federal Reserve.

Japanese Finance Minister Shunichi Suzuki described the rapid fluctuations in the currency markets as “undesirable” at a press conference.

A cheap yen against the dollar or the euro is considered beneficial for Japanese exporting companies, by increasing their profits and making them more competitive abroad.

However, an excessive devaluation could weigh down the Japanese economy, making more expensive the imported energy and raw materials on which it is highly dependent and which have skyrocketed globally as a result of supply problems and the Ukraine War.

Suzuki said the current depreciation of the yen is “negative” because these global price rises are not being compensated by salary increases such as those promoted by the government.

In the mid-session break, the Tokyo Stock Exchange registered a decrease of 0.65 percent in its main indicator, the Nikkei, which became positive during the morning although it fell into negative territory as the devaluation of the national currency accelerated. EFE

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