Why Japan is propping up the yen - and why the US helped
The yen's weakness has become a worry for the US.
Japan is propping up the yen due to a combination of factors that weigh on the currency, including its ultra-low interest rates compared to those in the US and other major economies, investor concerns about Japan's fiscal outlook, and the geopolitical tensions in the Middle East. The US has also played a role in supporting the yen through a joint intervention with Japan, warning that they would not hesitate to move again to defend its value if necessary.
The weakening yen has been a growing issue for Japan's policymakers, as it drives up import prices and household living costs. While the yen's slide has helped make Japan an affordable travel destination and boosted the profits of its biggest exporters, it has also contributed to higher costs for households and squeezed the profitability of domestic businesses.
Brief written by urgent.news from Straits Times Business's own syndicated text. Machine-written — may contain errors; check the original before relying on it.
