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Big Mac Index Cooks Abe’s Claim Yen Still Too Strong: Currencies

The increasing number of Japan’s trading partners who say Prime Minister Shinzo Abe’s campaign to drive the yen lower has gone too far are gaining ammunition from measures designed to assess the relative cost of goods.

The yen’s nominal rate of 91.03 per dollar today is 17 percent lower than the level that takes into account differences in consumer prices in Japan and the U.S., according to the Economist magazine’s Big Mac index. That’s the widest disparity since 2009 and makes the yen the most undervalued of any Group of 10 currency, according to the gauge, which measures worldwide prices of McDonald’s Corp.’s signature burger.