How Decline of the Japanese Yen is Affecting the Economy

The Japanese Yen is one of the most fluctuating currencies in the world throughout the history of economics. In Korea, there is even a concept called Yentech, which is the compound word of Yen and Tech. This is an action where people buy Japanese Yen when it is in a declining situation, and sell or trade in stocks when it is on the rise. Yentech happens because Japanese Yen is influenced a lot by their economical situation, trade, and Nikkei Stocks, especially in a decline. 

Mainly the decline of the Japanese Yen has had a positive effect on trading. Just like the Yentech, people started to have various trades in Japanese stock based on cheaper trade levels than other nations. The decline of the currency allowed other countries to access the stock market, benefitting both Japan and other nations. According to the Securities Information Portal of the Korea Securities Depository, the net purchases of Japanese stocks amounted to about 67.4 billion KRW which is about 51.1 million USD. This increase rate is about 12 times higher than the August of last year. 

Another beneficial effect is tourism. Japan is a country that highly depends on tourism every year, since it is the 11th most visited country in the world for 2023. Since the currency of the nation is lower, people tend to visit the country and spend more money in Japan. This is also helping the side region of Japan whether it is in the countryside or the cityside. 

There is also a negative aspect of the decline in the Japanese Yen, which is the recession. While the Japanese stock economy is growing in a better way by trading with other countries, the economy of Japan itself to its citizens is not really being seen as a better situation. As the currency value is decreasing, the wage of the workers in Japan is decreasing together, while the consumer price index is increasing. This makes it harder for people to survive in the society where they work for money and actually cannot use the money. 

Considering the fact that the Japanese economy has not increased in value for 30 years, the decline of the Japanese currency also seems to be the problem. Though the stock value compared with other countries is increasing, the most important thing to care about now for the nation seems to be how the citizens would survive in the decline.