1. ➢
Why is the Japanese Yen so strong?
What is its implications for an export-
driven economy like Japan?

2. ➢ Outline
・Introduction
・Historic Trends
・Causation
・Suffers
・Problems
・Countermeasure
・Summary
・References

3. ➢ Introduction
・The Yen is getting stronger against the Dollar in
the overall trend during the last 20 years.
・In an historic perspective, the strengthening of
the Yen had been predicted.
・The world's foreign currency exchanges has been
a concern for the strength of the Yen.

4. ➢ Historic Trends
・In 1993 - 1996 time-frame, the Yen was relatively
very strong.
・In 2010, the Yen reached a 15-year high against
the Dollar.
・A strengthening of the Yen fits the historic per-
spective of both the last 20 years and the last 3
years.

5. ➢ Causation
・If there is relatively more supply and less demand
for Yen, the Yen will weaken.
・If there is more demand and less supply of Yen,
the Yen will strengthen.
- A strengthening of the Yen means an increasing
demand for Yen compared to relatively less sup-
ply.
・The strength of a currency will hinge on trade
and current accounts.

6. ➢ Suffers
・The Japanese trade surplus.
・Thelow return on investments in the rest of the
world.
・The expected monetary policy in the U.S.
・Thediversification of foreign reserves in other
countries away from the U.S. Dollar and Euro.

7. ➢ Problems
・Bystrengthening of the Yen, the stock world
markets performance is poor.
・Bythe deflation in Japan, consumers' purchasing
power has increased.
・The domestic interest rates in Japan are not very
attractive to park your money.

8. ➢ Countermeasure
・To taking advantage of inexpensive labor costs
and lower taxes, industrial production is shifting
overseas.
・The Bank of Japan stands ready to enact mone-
tary policy for the possible effects of a prolonged
period of yen strength in the Japanese economy.

9. ➢ Summary
・By Yen is a currency with net inflows, the
strengthening of the Yen causes.
・A strengthening of the Yen is only having a very
negative effect in Japan.
・In overseas markets, the price competitiveness is
lose.

10. ➢ References
・Why is the Japanese Yen so Strong
http://www.stocktrendinvesting.com/blog/why-japanese-yen-so-strong
・ImplicationsOf Strong Yen On World Wide For-
eign Exchange Market
http://www.prweb.com/releases/2011/10/prweb8899591.htm
・Why is the Value of the Japanese Yen so Strong?
Interest Rates and the Carry Trade
http://www.reedconstructiondata.com/alex-carrick/post/why-is-the-value-of