Yen, inflation at levels unseen in decades not likely to sway BOJ

200yen to the dollar by xmas

"1 USD = 500 Yen and beyond" hyperinflation may come within this decade or sooner.

The missing link in the Japanese economy is robust wage growth for the BOJ to attain its inflation target stably and change its policy stance.

This is always the coda tacked onto the end of everyone of these stories concerning the BOJ and LDP economic policies.

The BOJ will keep its monetary easing QE, which is a basic income for the rich, and wage growth always will have to wait for the next empty economic plan after Abenomics and New Capitalism.

The Japanese people are in for a whole lot of dire financial distress

Wow… companies will definitely have to hike wages to attract foreign workers. I’ll agree that by Christmas the yen can possibly be 180-200

Well…..financially sound decisions not a strong point of the LDP. So expect more bad news before an expert panel is convened. Then by the time they make a recommendation….who knows not them that’s for sure.

Inflation unseen in decades, yes I get that when your head is in the sand.

inflation at levels unseen in decades not likely to sway BOJ

simple solution, get rid of the useless at the top.

bring in people who actually know what they are doing.

MMT / currency crisis / hyperinflation all on the horizon. Decades of money printing/ irresponsible government spending and stagnate economy will do that.

I know plenty of Japanese talking about the possibility of leaving Japan to work abroad and get better wages and have a better living standard. They seem to want Japan to return to the early 1900s when people moved to Brazil to coffee farm because they could have a better life than here.

As someone once said, don’t remember who? maybe a more informed poster can tell me.

‘Japan must suffer the unsufferable , that’s what’s happening.

It seems the Japanese yen, which was once seen as a safe haven currency, has now lost that status. The BOJ's rigid stance should be more flexible. The weak yen is causing inflation and falling real wages, and the BOJ should react. A small rise in interest rates would stop, or at least slow the fall of the yen. Time to act.

The Japanese people are in for a whole lot of dire financial distress

With 20 trillion is household assets? And Inflation at 3%? I dont think so. If you want to see a people in distress go take a look at the west. There have already been food and fuel riots.

French Labor Unrest Illustrates Worsening Economic Crisis within the EU

https://borkena.com/2022/10/20/french-labor-unrest-illustrates-worsening-economic-crisis-within-the-eu/

Lucky for me I get paid in USD! 

And you woke up and went to work teaching the ABCs.

"For now, there is no political pressure on the BOJ to change its policy. 

That’s an odd thing to say - just last week in parliament Kuroda was asked directly if he would resign immediately or not. It is already becoming a political issue and the LDP seem completely clueless about it all. Indeed they have doubled down calling for trillions more yen spending as “stimulus”.

I think you are all wrong .. the USD will crumble and the yen will get up ..

also the Japanese goverment has unlimmited money to push the yen up

also think only bout the US Bonds that Japan has ..

The disturbing thing is that people think that the central bank printing money for the government to spend, is a sensible method of trying to make for increasing wages.

That’s crazy.

People get higher wages when they obtain more skills and experience and produce more value, and there is a high demand for workers with their skills, and they can switch employers to take those higher wages. (Japan doesn’t have all these conditions met.)

None of that has anything to do with the central bank and government destroying the value of the currency.

also the Japanese goverment has unlimmited money to push the yen up

They have about 1 trillion dollars in reserves. So far each intervention has cost around 20billion.

the USD will crumble

Not whilst the FED continues to tighten, and other central banks keep on printing.

They intervened again this morning. Lasted only a few minutes before the gains were wiped out.

That would be $20 billion. Thank you come again.

clear result or worthless and actionless deeply corrupted government.

When everyone knows that yes rate went down 5 yen because of currency manipulation?

it just solidifies that the rate really is at least that previous amount. Yen rate now almost 149 again, already.

The only "crisis" Japan suffers right now is a central bank head who refuses to raise interest rates even 25 basis points. The rest of the world is over their QE experiment, but Japan, who started the entire quantitative easing remember, refuses to go along with the rest of the developed world in fighting inflation the old fashioned way. Thus, the markets will refuse to buy Japan (bonds, yen) until this silly policy ends. They've already shown how worthless "intervening" to prop up the yen truly is. Policy at the central bank of Japan needs changing, but Kuroda will simply not play ball.

Until then (which will not be until April 2023 at the earliest, since Kuroda will go out in a blaze of stupidly easy money policy at the end of his term, and we have to wait for a new bank head), expect the yen to fall against the dollar. It's inevitable: markets are signalling in the UK, in Turkey and in many, many other places besides, that zero interest rate policies plus exploding deficit spending are at an end in the face of persistent inflation. Yet Japan still thinks it can have its cake and eat it, too...

Now, should Japan be like China and start selling Treasuries to pay for their pointless "interventions/deficit spending" to the point where T-bills become suspect due to the US's own endemic fiscal debt situation? The world's number 1 and 2 buyers of treasuries stop buying up all that debt? THAT might trigger a global meltdown of historic proportions...

I don’t think the MOF will have the US blessing to start dumping US treasuries to obtain dollars to burn trying to prop up the yen.

Especially not right before US midterm elections.

At least Kuroda could cool off his dopey yield curve control scheme, and then let the government deal with their addiction to deficit spending.

Or resign.

I am thinking the pressure must be really getting to him at this point. Truss quit after 44 days; Kuroda is doing exactly the wrong thing now, and he probably knows it - so resigning and letting someone else clean up his mess seems like an increasingly likely option.

This could help the yen for a time, too.

There goes my Christmas trip :(

When the economy goes into recession next quarter the government isn’t going to have a single method for pushing a recovery. The current policy is guaranteed to create another 10 of stagnation.

And you woke up and went to work teaching the ABCs.

Not every foreigner that comes to Japan teaches English, please don’t buy into that old myth.

The disturbing thing is that people think that the central bank printing money for the government to spend, is a sensible method of trying to make for increasing wages.

That’s crazy.

It has nothing to do with increasing wages except for rentier investors; the wealthy LDP supporters. Printing money works out amazingly for them.

Don't conflate the two.

Quantitative easing as practiced by the BOJ and many other central banks is a basic income for the rich.

https://twitter.com/mcuban/status/1318929147348090882

Let them think that While I am making 6 figures, working from home, only working for less than a year. How long does it take one to make 6 figures working for a Japanese company? 15 years? 20 years? This is why I encourage foreign people to not work for a Japanese company when they live here.

I agree, I did it one time for a year and like you, went the same route and never looked back and I wouldn’t advise it as well.

To fully understand the danger Japan is now in, search "Kyle Bass- the coming crisis in Japan" on You-tube. Listen to the full lecture carefully may need you to rinse and repeat a few times if you don't come from an Economics background but basically Jp is Check mate. The sliding yen is a big crack and will get bigger by the day, the BOJ can do very little about it and will be overwhelmed. Japanese Government bond holders including the average Mr and Mrs Yoshida and Japanese pensions will be left holding the bag.

200yen to the dollar by xmas

May your prophecy become reality, wise poster.

3% inflation “excluding volatile fresh food items” - the most important thing to the average person who hasn’t seen a pay increase in many years.

Get the sense that most people are definitely starting to feel financially squeezed now.

The USD is appreciating rather than the Yen declining. This, of course, affects other currencies including the Indian Rupee, SK Won, and Chinese Renminbi. Japan Inc does not want the Yen appreciating against them.

Don't worry, the Japanese Yen is at an all time low against the Chinese Yuan (from earliest year 1996 google currency conversion)

Increasing wages will in turn causes more inflation won't it?

Bonnie Webber

you must be on a working visa to work here or married to a Japanese.

90% Of foreigners in Japan are not English teachers. Not even close.

“The number of foreign residents of Japan reached a high of 2.93 million in 2019 before falling to 2.76 million at the end of 2021.

The number of foreign workers was 1.46 million in 2018, 29.7% are in the manufacturing sector; 389,000 are from Vietnam and 316,000 are from China.”

Chinese are the largest group. 800,000 32% of foreign pop.

Korean 450,000 18% of the foreign pop.

The majority of foreigners are not English teachers.

People wanting to see the yen raise against the dollar are only selfish people thinking of themselves and not the crisis it causes the country especially for energy imports. I receive some money from the US too.

May your prophecy become reality, wise poster.

Let's hope it doesnt though hey. Maybe the BOJ can perform a Christmas miracle...

 I can remotrle work for a US company, live here, and make 4 times that, working less than 40 hrs a week.

you seem to spend an awful amount of time telling everyone about how much money you earn.

Unbelievable BOJ spent over $50billion to intervene, poof gone like that! That’s around 100000yen per person they could have helped. The Japanese people don’t even realize or seem to care but mostly ignorant because they have no knowledge of financial economics!

Why would they come here, to pay 45% income tax when they can go to those other places and pay 15%?

This is one for the biggest problem with the Japanese economy. They arent willing to make concessions to attract the real money makers.

Again, I think the argument of BOJ is totally insane.

Why they can expect the inflation rate will return to below 2%? US is still at nowhere to curb with their inflation.

There is no correction of interest rate and wages.

BOJ has been fighting for raising the economy over the last 20 years. If BOJ’s predictions and policies are so fuburous, why the economy is still stagnant today?

Why would they come here, to pay 45% income tax when they can go to those other places and pay 15%?

Then see the UK. Try to eliminate the 45% tax bracket and people decry it as “tax cuts for the rich”.

Things need to get really bad before some good policies can be enacted.

The only "crisis" Japan suffers right now is a central bank head who refuses to raise interest rates even 25 basis points. The rest of the world is over their QE experiment, but Japan, who started the entire quantitative easing remember, refuses to go along with the rest of the developed world in fighting inflation the old fashioned way. 

I have long held the view that central banks have held interest rates too low and for too long. But I'm not sure that increasing interest rates is really going to help control inflation in Japan. This is a cost push inflation, driven principally by the strength of the yen and the cost of oil, which has pushed inflation to around 10% internationally.

Higher interest rates in Japan will ultimately have some effect on prices, but at a relatively high cost on domestic demand.

Then see the UK. Try to eliminate the 45% tax bracket and people decry it as “tax cuts for the rich”.

Things need to get really bad before some good policies can be enacted.

They were very literally tax cuts for the rich. But most entrepreneurs don't really worry about income tax levels because they pay themselves through dividends or even loans.