Japanese Prime Minister Sanae Takaichi acknowledged that the recent yen depreciation is an opportunity to increase revenue from the export sector and the government’s foreign exchange fund.
In his speech at a mass rally in Kawasaki, Mr. Takaichi referred to the history of Japan’s currency and the way it dealt with the depreciation of the yen through pre-arranged measures, saying, “The management of the special account of the Foreign Exchange Fund is going very well.”
fuel inflation
Takaichi points out that the yen was strong during the Democratic Party of Japan’s administration (2009-2012), and that it is not clear whether the currency is strong or weak. He did not mention concerns that a weaker yen would cause inflation.
A weaker yen supports exports by making Japanese products cheaper overseas and increasing overseas earnings when converted to yen, but it also raises import prices. Resource-poor Japan relies heavily on imports to meet its food and energy needs.
Japanese Prime Minister Sanae Takaichi acknowledged that the recent decline in the value of the yen is an opportunity to strengthen the export sector and the income of the government’s foreign exchange fund.
In his speech at a national assembly held in Kawasaki City, Takaichi mentioned the history of the Japanese currency and how to deal with a weak yen through advance preparation, and said, “The operation of the Foreign Exchange Fund Special Account is progressing very smoothly.”
sharp increase in inflation
Takaichi points out that the yen appreciated during the Democratic Party of Japan’s administration (2009-2012), and pointed out that it is clear whether the currency is strong or weak. He did not mention concerns that a weaker yen could spur inflation.
A depreciation of the yen supports exports by making Japanese products cheaper overseas and increasing overseas earnings when converted to yen, but it also increases import prices. Resource-poor Japan relies heavily on imports to meet its food and energy needs.
