The Impact of Yen Appreciation on Japanese Economy

The appreciation of the yen is really not conducive to economic recovery and easing deflation. First of all, the sharp appreciation of the yen affects Japan's export competitiveness and hinders economic recovery; Secondly, the Japanese authorities hope that the yen will depreciate moderately, so as to push up domestic prices and reduce deflationary pressure by improving the transmission mechanism of commodity prices. The appreciation of the yen will disappoint this expectation. Due to the different reasons and backgrounds of the appreciation of the yen and the adjustment of Japan's economic structure, the negative impact of the appreciation of the yen on Japan's economy is much smaller than before. First of all, the main reason for the appreciation of the yen is that the United States has changed its monetary policy and tolerated the moderate depreciation of the dollar, not the yen itself. Therefore, the biggest feature of this appreciation of the yen is that it only appreciates against the US dollar, not against other major currencies, but depreciates sharply. Among them, the exchange rate of the yen against the euro fell to the lowest point since the advent of the euro. The depreciation of the yen against the euro has greatly weakened the adverse impact of the appreciation of the dollar on the Japanese economy.