Weak Yen’s Mixed Blessing Turns More Toxic for Japan
- Softer currency is exacerbating pain of higher import costs
- BOJ Governor Kuroda says a weak yen is still positive overall
This article is for subscribers only.
A weaker yen has long been considered a boon for Japan’s economy, helping blue-chip exporters such as Toyota Motor Corp. But that narrative is increasingly in question as the yen’s recent plunge aggravates the impact of surging commodity prices, hitting some businesses and consumers much harder than before.
“The negative effects, or the risks from the weaker yen we’re now seeing, are unprecedented,” said Eiji Hashimoto, chairman of the Japan Iron and Steel Federation. While steelmakers and other manufacturers benefited from past phases of yen weakness, the current spike in energy and materials costs mean “this time it’s totally different,” he said last week.