Currency war, lost!The exchange rate has plummeted, and the economy has experienced negative growth

Mondo Finance Updated on 2024-01-19

30 years apart, the United States and JapanEconomyThe gap is widening, and the GDP of the United States has reached 2574 trillion US dollars, while Japan's GDP is only 423 trillion dollars. Since 1995, Japan's GDPChartsThere is a clear trend, once reaching 6$27 trillion peaked, but then again ** to current levels. This is the same as Japan after World War IIEconomyThe situation that took off and threatened the United States in the 80s was very different. Initiated between Japan and the United StatesCurrency warsJapan has no choice but to continue to bear itRecessionThe price.

Japan is felt in the United StatesEconomyAfter the threat of the rise of the United States, the excuse was givenJapanese YenThe devaluation led to an imbalance between Japan and the United States, and Japan was required to signThe Plaza AccordAnd letJapanese YenSignificant appreciation. This move has made Japan's various assets ** also substantially **, forming a hugeAsset bubbles。However, the bubble eventually burst in the early 90s, leading to the collapse of the housing market and **EconomyStuck in a slump. It's been going on for almost 30 years now.

In recent years, with the Federal Reserve's interest rate hikes, currencies have generally depreciated to a certain extent, but the most affected ones are the onesJapanese Yen。This yearJapanese YenofExchange rateAgain, a large **, with a maximum drawdown of more than 15%, making 1 dollar to 151Japanese Yen, it seemsJapanese Yenwill usher in the fate of being cut leeks by the dollar. Japanese YenAgain inCurrency warsFailed.

However, inJapanese YenAgainst the backdrop of continuous depreciation, Japan has unexpectedly shown a "god-like" operation. Starting in June, the Bank of Japan has been buying for three consecutive monthsU.S. TreasuriesIt wasn't until September that the sell-off began. And surprisingly, according to official data, although the central bank sold 28.5 billionU.S. Treasuries, but Japan's net amount in September reached about $20 billion. This could mean that ordinary institutions and the public are constantly buyingU.S. Treasuries, and even the purchase volume reached 48.5 billion US dollars. This raises doubts about whether the Japanese would be more willing to cooperate with the dollar harvest.

Recently, Japan'sEconomyScientist**, next year the Bank of Japan will raise interest rates. If this ** becomes a reality, and coincides with the situation when the Fed has to cut interest rates, it will be Japan in the entiretyCurrency warsThe best chance of counter-attacking. Japan has not raised interest rates for a long time, and if it does, it will be rightJapanese YenIt's a good support. Coupled with the fact that the United States has to cut interest rates by 100 basis points, it may lead toU.S. dollar indexFast**, thenJapanese YenThe appreciation against the dollar will be even greater. Japan is faced with the choice of being harvested by the dollar or killing the dollar, and this situation has reached a critical moment.

Currency warsLet JapanEconomyHuge losses were incurred, making the yen a victim again. 40 yearsEconomyThe downturn has forced Japan to endure a long period of negative growth. However, Japan is inCurrency warsThe operation in is incredible. With Japan's counterattack in the future, we may be able to see if Japan will be able to turn the tide and emerge victorious. Regardless of the outcome,Currency warsAlways giveEconomyThe system brings great fluctuations and challenges. Next, we'll see.

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