【Latest yen exchange rate trend analysis】How to invest in Japanese yen?

Today's Latest Japanese Yen Exchange Rates

As one of the most traded currencies globally, the Japanese Yen (JPY) currency pair accounts for nearly 15% of global forex trading volume, second only to the US dollar and euro. It is important because it reflects Japan's economic status as the third largest national economy and its extensive global trading network. The yen rate is naturally of interest; and in the Hong Kong region, it is a common concern.JPY to Hong Kong DollarIt's all about traveling to Japan. Once the yen depreciates, $1 HKD can be exchanged for more yen, and it becomes more affordable. When shopping locally, things are like being discounted, stimulating consumption.

A Review of Past Yen Exchange Rate Trends

In the beginning of 2021,US Dollar vs Japanese Yen Exchange RateMaintain a level around 105 yen. Subsequently, as the US economy recovered, the Fed's monetary policy shifted and the yen gradually depreciated to a high of 122 yen/USD in March 2022.

Subsequently, the yen rallied, mainly due to the Bank of Japan maintaining ultra-loose monetary policy, while US rate hikes are expected to ease. In September 2022, the USD/JPY exchange rate rose once again to 143 yen.

However, the dollar index continued to strengthen in the second half of 2022, pushing the yen to depreciate again. As of early 2023, the USD/JPY exchange rate is around 138 yen.

Going into 2023, influenced by the slow pace of the US Federal Reserve's rate hike, the yen rebounded somewhat to around 130 yen.

At the beginning of 2024, the US dollar against the yen has fallen to 155 yen, a new low since the yen began to depreciate in June 1990! Some analysts believe that this is the mainstream trend of selling yen and buying USD as market investors are aware of the continued widening of the US dollar spread.

All in all, over the past three years, the USD/JPY exchange rate has been basically in the range of 105-143 yen, from rising to falling, to partially rebounding, and the future direction of the yen will depend on the monetary policy of each central bank. If you are interested in the Japanese yen or the Japanese stock market, pay close attention!

Factors for the change in the yen's trend

1. Tightening monetary policy is expected to slow down the pace of the Fed's rate hikes and monetary policy stance will directly affect the dollar's movements, thereby affecting the yen exchange rate. The Fed's monetary policy shift in 2021 pushed the dollar sharply higher and led to the depreciation of the yen.

2. The US spread widens When the US spreads widen, overseas funds tend to flow out of Japan, to the detriment of the yen.

3. Japanese economic growth weakened the strong US economic recovery, which also supported the dollar compared to the better performance of the Japanese economy. Japan's weak economic growth has intensified the yen's depreciation pressure.

However, the depreciation of the yen is often a favorable factor for corporate profits. So, which stocks are expected to benefit?

Content reference:Worth collecting! Japanese stocks are looking for investment opportunities

How to invest in the Japanese market in Hong Kong?

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