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Yen's fall to 34-year low unlikely to prod BOJ to tighten policy soon

20 Comments
By Tomoyuki Tachikawa

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Normal US annual money supply increase, approx. inflation plus economic growth, b/w 4 and 5%, 2021 Biden Admin money supply increase, by far largest % increase in US history. Any surprise investors around world sought out higher US rates, sold their (e.g. Yen) currencies?

Question, why US above record money printing? Turns out China and Russia BRICS led de-dollarization, set off global financial wars, inflation and capital flows being weaponized. No surprise BRICS seeks $de-dollarization.

-5 ( +4 / -9 )

overhauling its neo-lib orthodoxy monetary easing framework that had been implemented over the past decade to boost investor assets.

Fixed for accuracy.

https://www.cnbc.com/2013/12/18/qe-the-greatest-subsidy-to-the-rich-ever.html

But many economists point out that this wage growth mainly benefits employees of large firms, with the March Kyodo News poll showing that 87.9 percent of respondents do not feel that Japan's economy has improved.

Who would have guessed with the neo-feudal policies of the BOJ and LDP and their Japan-INC cronies?

-5 ( +4 / -9 )

BOJ will adopt a wait-and-see attitude at least until the fall.

Not surprising

5 ( +11 / -6 )

Pathetic. Find people with a back bone if these old goats can't be bothered to do their job.

-3 ( +7 / -10 )

A weaker yen is usually a boon for Japanese exports but also poses problems in other areas, raising import prices and triggering cost-push inflation. Japan depends on imports for more than 90 percent of its energy needs.

It is at least somewhat encouraging to see this phrase rather than the usual copy-pasted LDP/BoJ propaganda that so many other articles contain when talking about currency devaluation and inflation.

But the Japanese people are not fooled:

with the March Kyodo News poll showing that 87.9 percent of respondents do not feel that Japan's economy has improved.

That leaves 12.1% who are either neutral or who think things are getting better, which tracks well with what "quantitative easing" is designed to do: benefit the rentier-class rich at the expense of the workers.

3 ( +3 / -0 )

a 34-year low against the U.S. dollar is unlikely to prompt the Bank of Japan to tighten its policy again anytime soon, with the yen's underlying trend expected to reverse course later this year.

Typical Japan.

If it's broke, don't fix it.

Wait till "someone else" solves it.

-4 ( +3 / -7 )

Now is the time to ask your company for a pay rise and if the answer is negative then almost any manual job in a 1st world country pays more than any equivalent or better in Japan-better to leave than waste your life…

-8 ( +3 / -11 )

Japan remains a first-world country.

6 ( +10 / -4 )

Well since the USA is the worlds biggest market this is good for Japanese exporters. Japanese good will become cheaper for the American consumers. When those companies repatriate those dollars to yen, they’ll get more for their dollar. American who wish to visit japan will also get more for their dollar too boosting the travel industry. Also if the yen gets weaker this” MAY” be good for all those NISA buyers, in the Nasdaq or S&P500 and the Nikkei 225 where all those Japanese companies are listed.

-2 ( +0 / -2 )

@wallace

Japan remains a first-world country.

The pay in Japan doesn’t reflect it though.

Especially gig jobs or part time work.

Minimum wage per hour:

The UK is twice Japan and Australia three times.Even tiny Luxembourg offers 2600円 per hour.

And the yen is becoming weaker…

-8 ( +4 / -12 )

Nonetheless, Japan is a first-world country where you continue to live and work.

7 ( +10 / -3 )

If it weren’t for family ties, I wouldn’t be here.

0 ( +4 / -4 )

It's a sinking ship

-4 ( +4 / -8 )

kurisupisuToday  11:14 am JST

@wallace 

Minimum wage per hour:

The UK is twice Japan and Australia three times. Even tiny Luxembourg offers 2600円 per hour.

Are you trying to hold up the UK as a good example of how to run an economy/country? I don't think it matters how much you earn per hour. It is the amount you earn relative to the cost of living and the services you receive. The UK's cost per capita has fallen since 2008, and had inflation to boot Even Poland is doing better than the UK. Japan's salary may not have increased as much as the UK's but they've had NO INFLATION. Education in the UK is falling apart, as are the buildings. a Health Service on its knees, a shrinking economy with an enlarging population. House prices are through the roof, and the average person can't buy a studio flat let alone a 2-bedroom home. Landlords creaming it in, jacking up the rent to cover their loans, and when interest rates fall, they will cream in even more, because they are NOT going to lower rents, so again, the renter can't save to buy a home. UK with food banks everywhere. The military cut to the point it can't even fill a football stadium. University costs rocketing, to the point that it i the cost of a home loan in 2000. They have to earn more to pay for all those increases. Roads with more holes than all the golf courses in Japan. (probably). So what austerity worth it? I think voters were suckered into that belief, and the debt is even bigger than in 2010. The people in the UK may earn more per hour, but they are per capita poorer in real terms with worse services. And we haven't even considered Brexit. Austerity crushed the UK, and the Tories blamed the EU for all its ills and the voters needed someone to blame. Sadly the animals voted to put the pigs in the farmhouse. But at least we got our blue passport!

0 ( +2 / -2 )

The problem is that most politicians in senior positions and last 2 presidents of the BOJ are in their late sixties and seventies . They still believe that a weak JPY is clearly in favor of the economy as it was in the eighties when they were younger. At that time Japan was exporting tons of stuff like consumer electronics but it is not the case anymore as they have been replaced by the US, Korea…etc.

3 ( +3 / -0 )

Kurisupisu Today | 11:39 am JST: "If it weren’t for family ties, I wouldn’t be here."

This salient statement probably applies to many of us, but none want to admit to the stark reality (including myself) because you can't return home.

4 ( +5 / -1 )

So is there a magic number the e/r should be? Have to accept it may never fall below 150 again. Personally, suits me fine regarding my investments.

-1 ( +0 / -1 )

the yen's underlying trend expected to reverse course later this year.

That’s what they were saying at the end of last year…

0 ( +1 / -1 )

With expectations growing that the U.S. Federal Reserve will begin cutting its key interest rate in the near future,

US inflation is above target.

Over optimistic expectations for lower rates have been wound back big time this year.

Come June, it might not happen. Let’s see.

Higher inflation would warrant an interest rate hike, not a groundless cut.

the dollar is poised to face a downturn versus the yen in the mid- and long-term

Um because the BOJ is printing craptonnes of yen whereas the FOMC is reducing their balance sheet?

Great analysts, Kyodo.

0 ( +1 / -1 )

Are you trying to hold up the UK as a good example of how to run an economy/country?

No, not at all.

My post(s) was to highlight the disparity in minimum wages.I gave other countries as examples, other than the UK.

I could have fielded South Korea, as another example of a ‘well run country’ with a higher minimum wage than Japan too…

0 ( +0 / -0 )

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