There seems to be alarm that the Japanese Yen has strengthened below 80 Y/USD. There are signals that a coordinated G7 monetary action will push the Yen back down. These are corporatist policies that actually won't benefit large Japanese corporations hurt by the disaster. Toyota will not export many cars in the comming months even if they Yen goes down to 150 Y/USD. Certainly, a weak Yen will help those exporters unaffected by the crisis, but this is literally the only group advantaged by weaker rather than stronger Yen.
Japan is soon faced with rebuilding. This means imports of lumber, steel, copper. This will create strong entrepreneurial sector within Japan. The Japanese people may need more food imports. A stronger Yen makes the Japanese people richer and makes their lives and rebuilding easier. It is not the time to pay attention to financial institution concerns, or this week's stock prices, on Yen volatility.
There is likely to be pressure against the Yen in the future anyway. But trade balance management is only a future concern for Bank of Japan. My message to Bank of Japan, and the Japanese who can influence them: Enjoy the strong Yen while you can.
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