Shock Commodities Spike Threatens to Push Yen to Six-Year Low
- Widening interest-rate differentials are boosting dollar-yen
- Rising oil, commodity prices to impact Japan’s current account
A customer purchases oranges at a store in the Ota district of Tokyo, Japan.
Photographer: Takaaki Iwabu/BloombergThis article is for subscribers only.
The headwinds for yen are getting stronger and threaten to push the currency to a six-year low against the dollar.
A spike in global commodity prices spurred by Russia’s invasion of Ukraine is likely to worsen Japan’s trade deficit as the country is a net oil importer and may push the yen to 120 per dollar this year, said Mitsubishi UFJ Morgan Stanley Securities. Mizuho Bank Ltd. and TD Securities both predict the currency will weaken to 117 by the end of June, from 114.82 on Friday.