Yuji Kameoka, chief currency strategist at Daiwa Securities Co. said “The dollar-yen rate will rise beyond 90,”. Being the chief currency strategist at Japan’s second largest brokerage, his words are worth paying attention to. Japanese corporations are hoping Komeoka’s predictions comes to pass soon.
Exports are critical to the Japanese economy. The economy of Japan relies heavily on exports, exporting to the United States, China, South Korea, Europe, and other nations.
A strong currency makes exports very pricey for overseas buyers. Having an export-based economy, Japan desires the Japanese Yen to be weak. Japan manufacturers long for a weaker Yen so, theoretically they can sell more goods to their overseas buyers.
Shinzo Abe has returned to the Prime Minister position and is looking to weaken the Yen exponentially.
Panasonic chairman told reporters in Tokyo that the depreciation of the Yen is already helping their company.
Japan’s economy is expected to expand .65% this year, while the U.S. economy is expected to grow 2% according to the median estimates of Bloomberg. In the recent months, the Yen has hit lows unseen since 2010 and will likely continue to weaken.
Currently, depending on technical analysis signals of today and this weak, there may be a pull back before the USDJPY breaks up towards 90.00.
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