Impact of Strong Yen
Impacts of a Strong Yen
Strong Yen and its impacts on Japanese economy
The fluctuating of yen in the economy, mostly the appreciation, is a major concern for the economic world. According to Kawanishi (2001), by 1999, the strong yen had emerged as a problem to the economy of Japan. The issue of the rising Japan’s Yen is among the top issue on Japan’s economy that is partly within the control of the government. Since Japan’s dominance in the economic industry to its economic greatness, there has been a lot of economic crisis.
The cause of economic crisis for Japan is enhanced by factors ranging from lack of entrepreneurship skills, the cheap, work forces by China and raised energy costs, after the nuclear disaster, among others. Despite the problem, the government has received blame for taking no measure to control the alarm caused by the high rising yen. The rise of the yen to an extent of fitting into an economic issue began mostly in the United States and later spread to Europe. This according to Fackler resulted in 2007 after the American housing crisis.
Obstfeld explores the relation between Japan’s microeconomic developments and the rates of the currency at the time of Japan’s bubble economy, as well as the resulting stagnation. Also, Obstfeld points out the determinants of the rising of yen. The Bank of Japan’s act of keeping the interest rates low resulted to money flowing out of Japan. Initially the plan aimed at stimulating growth and searching for higher returns. The yen rated at 76 to the dollar at the time and remains not too far from the level today. The importance of Japan’s economy to the U.S. rages from the Bank of Japan being the largest holder of the treasuries in the United States. The aim of this is to keep the yen relatively low than the U.S. dollar and also make the yen highly competitive. The result of this is a high percentage of the GDP output making Japan’s economy weak.
According to Sing, “a strong yen has both beneficial and
Strong Yen and its impacts on Japanese economy
The fluctuating of yen in the economy, mostly the appreciation, is a major concern for the economic world. According to Kawanishi (2001), by 1999, the strong yen had emerged as a problem to the economy of Japan. The issue of the rising Japan’s Yen is among the top issue on Japan’s economy that is partly within the control of the government. Since Japan’s dominance in the economic industry to its economic greatness, there has been a lot of economic crisis.
The cause of economic crisis for Japan is enhanced by factors ranging from lack of entrepreneurship skills, the cheap, work forces by China and raised energy costs, after the nuclear disaster, among others. Despite the problem, the government has received blame for taking no measure to control the alarm caused by the high rising yen. The rise of the yen to an extent of fitting into an economic issue began mostly in the United States and later spread to Europe. This according to Fackler resulted in 2007 after the American housing crisis.
Obstfeld explores the relation between Japan’s microeconomic developments and the rates of the currency at the time of Japan’s bubble economy, as well as the resulting stagnation. Also, Obstfeld points out the determinants of the rising of yen. The Bank of Japan’s act of keeping the interest rates low resulted to money flowing out of Japan. Initially the plan aimed at stimulating growth and searching for higher returns. The yen rated at 76 to the dollar at the time and remains not too far from the level today. The importance of Japan’s economy to the U.S. rages from the Bank of Japan being the largest holder of the treasuries in the United States. The aim of this is to keep the yen relatively low than the U.S. dollar and also make the yen highly competitive. The result of this is a high percentage of the GDP output making Japan’s economy weak.
According to Sing, “a strong yen has both beneficial and