Why is the Japanese Yen

so strong? s1180043

Mitsuru Abe

Why is the Japanese Yen so strong.

Yen is stronger than Dollar

Heavy debt

The trade cash flow

The investment cash flow

Investment in the Japanese economy

Summary

Outline

The cause for the strengthening of the Yen is that the Yen is a currency with net inflows; more Yen are bought then that there are Yen sold.

Why is the Japanese Yen so

strong.

Yen is stronger than the dollar If you look at the data of

the past 20 years. Yen is what fit well with the historical

perspective of both over the past three years as well as

the past 20 years. Therefore, there is no big surprise here

the yen has continued this trend at this time.

Yen is stronger than Dollar

The power of money in the country will become more

intense economic strength becomes strong to think

simply. Japan is also becoming stronger yen. However,

there is a large amount of debt in Japan. Amount of

Japan's public debt is twice of America.

Heavy debt

It is exported than imported Japan has a trade surplus.

This keeps the strong state the currency. There is a

possibility that imports will increase in the long term

reduce the exports strengthening currency. However, it is

possible to strengthen itself by reducing the supply of

yen needed to import in the short term. America is

importing more than you export it. Trade deficit of the

United States to weaken the U.S. currency.

The trade cash flow

Assets of Japan seems to be there is a strong demand

from foreign investors for money market instruments.

Demand for assets other than Japan is definitely more.

There is also a fact that recommends the Japan

government bonds for decades yen despite low levels

worldwide depositors of Japan.

The investment cash flow

Difference between the interest rates of Japan and the

United States will have the impact on the exchange rate.

Japanese interest rates were the lowest always. But when

raising the interest rates for the foreseeable future is not

expected, the United States expects the difference is

going to be big. , Carry trade will strengthen the yen

further. The same thing happens when to become

investment outside Japan to provide benefits or lower

risk than is expected.

Investment in the Japanese

economy

Therefore from that circle, the currency and net inflows,

cause of the yen has been caused by investors who are

buying the yen. The reason for this is that you have

diversification of foreign exchange reserves in the

United States and other countries strengthening trend

itself away from the United States, Japan's trade surplus,

the rest of the world, expectations and monetary policy

in the United States. It is not the thing yen can not be

expected in a historical perspective.

Summary

http://www.stocktrendinvesting.com/blog/why-japanese-yen-so-strong

http://www.marketwatch.com/story/japan-stocks-slide-while-australia-trades-up-2013-04-01

http://forum.gaijinpot.com/showthread.php?116799-The-Japanese-yen-why-is-it-so-strong

Reference