If inflation drove Japanese yen to 10000 yen = 86 USD, why is Japan still rich(G8)?

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If inflation drove Japanese yen to 10000 yen = 86 USD, why is Japan still rich(G8)?

2006-07-23 05:35:26 · 2 answers · asked by DeathStar 4 in Business & Finance ➔ Other - Business & Finance

2 answers

Japan is still rich as Japanese only choose local products over foreign products. As their country, they buy their own local products, when oversea, they sell their products too...

2006-07-23 16:06:02 · answer #1 · answered by Tan D 7 · 1⤊ 0⤋

Well, 10,000 yen is equal to US$86 today.

If Japan has massive inflation, it's true that yen will not worth as much in USD then, which mean it's more expensive for Japanese to buy foreign goods. However, Japan has one of the largest holdings in USD and USD bonds. In a way, their JPY/USD currency exposure is hedged.

2006-07-23 13:07:28 · answer #2 · answered by Anonymous · 0⤊ 0⤋