ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon Print

Yen at risk of downward spiral fueled by trade deficit, BOJ easing

Concerns of vicious cycle bring benefits of weak currency into question

The immediate cause of the yen's weakness is a split in monetary policy between Japan and the U.S.   © Reuters

TOKYO -- The yen's recent nosedive has heightened fears of a vicious cycle as Japan's worsening current-account balance threatens to spur more selling.

A soft yen was long seen as a boon to Japan's economy. But with the benefits now tilted toward certain exporters and the wealthy while individuals and small businesses feel the pain of higher commodity prices, Japan may need to rethink a fundamental assumption of its economic approach.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more