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.
FocusEconomics 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||105.9||121.1||108.8||112.2|
5 years of economic forecasts for more than 30 economic indicators.
Japan Exchange Rate (aop) Chart
Source: Thomson Reuters
|Bond Yield||-0.16||-4.41 %||Jul 31|
|Exchange Rate||108.8||-0.35 %||Jul 31|
|Stock Market||21,522||0.40 %||Jul 31|
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August 23, 2019
The core consumer price index rose 0.1% in month-on-month seasonally-adjusted terms in July, contrasting June’s 0.1% drop. Core inflation was stable at June’s 0.6% in July.
August 22, 2019
The Jibun Bank flash manufacturing Purchasing Managers’ Index (PMI) rose from July’s 49.4 (previously reported: 49.6) to 49.5 in August.
August 19, 2019
Nominal yen-denominated merchandise exports fell 1.6% year-on-year in July, up from June’s 6.6% decline.
August 14, 2019
Core machinery orders, a leading indicator for capital spending over a three- to six-month period, posted the fastest expansion since January 2003 in June, suggesting that capital expenditure will remain resilient in the coming months.
August 9, 2019
GDP expanded 1.8% in seasonally-adjusted annualized terms (SAAR) in Q2, below the 2.8% (SAAR) expansion registered in Q1 but comfortably beating market analysts’ expectations of a 0.4% increase.