(Harvest) The yen’s strength appears most pronounced when compared to the Chinese yuan. This week, the yuan was at its weakest level against the U.S. dollar in more than five months. As the following chart shows, after peaking at an all-time high of 20.285 last August, the CNYJPY rate has fallen by 18%. A new downward trend in the exchange rate appears to have been established, with no sign that it is going to reverse course. China has been Japan’s largest trading partner since 2007 and also the largest source of its overseas tourists since last year. Any further devaluation of the Chinese yuan against the yen would be disastrous for Japan.
A Stronger Yen is The Last Thing That Japan Wants or Needs
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