・Yen/Dollar Historic Trends
・Expected the Opposite
・Demand for Japanese Assets
・Case of Currency Impact
・The Strong Yen Characteristics
・Recently, the Yen was the highest level the
currency has hit.
・ I think that why the Yen so strong and I want
to know that reason.
・Here are the research and conclusion on it.
Yen/Dollar Historic Trends
・The Yen/Dollar exchange rate has a
fluctuating pattern with continuous lower tops.
・The Yes is getting stronger than Doller
・The Yen was then relatively very strong before
1996 and after 1996
Expected the Opposite
・The domestic interest rate in Japan are about
the lowest in the world and not very attractive to
park your money.
・Japan has an aging population and this will
temper the economic growth in Japan.
・Japanese public debt as a percentage of GDP
is about twice the size of the U.S. public debt.
Demand for Japanese Assets
・Japanese assets coming from partly foreign
・Japanese interest rates have always been the
lowest, but when the expectation is that this
difference is will become less big.
・Thus, The same thing will happen in outside
Japan that are expected to become more risky
or providing lower returns.
Case of Currency Impact
・The initial reaction in the currency markets
was a strengthening in the value of the yen
versus the U.S. Dollar in the earthquake on
・Thus, Japanese investors world pull their
money put of other countries and put it back in
Japan. And that's exactly what did happen.
The Strong Yen Characteristics
・It's a stable currency and a relatively economy
that's not affected so much by global crises.
・But, when the yen gets too high, Japanese
companies can't sell their goods overseas and
this causes major problem for the Japanese
・I knew why Japanese Yen so strong alongside
・I understand that Japanese Yen might need
from the market and Japanese government that
fund relief and reconstruction efforts in Japan.