Japan premier warns of negative impact on companies from weak yen

Economy42 minutes ago (Oct 12, 2021 04:22AM ET)

(C) Reuters. FILE PHOTO: Japan’s new prime minister Fumio Kishida delivers his first policy speech at parliament in Tokyo, Japan, October 8, 2021. REUTERS/Kim Kyung-Hoon

By Leika Kihara and Tetsushi Kajimoto

TOKYO (Reuters) -Japan’s Prime Minister Fumio Kishida said on Tuesday the government will scrutinise the impact on the economy from any further declines in the yen, which risk hurting corporate profits.

Japan’s wholesale inflation hit a 13-year high in September as rising global commodity prices and a weak yen drove up input costs, adding more stress on firms already hit by supply constraints and clouding the outlook for the economy.

“If the yen weakens further, it will boost exports. On the other hand, it will lead to a rise in costs for companies through higher import costs,” Kishida told parliament.

“We will closely watch the impact of currency moves on companies,” he said, when asked by an opposition lawmaker on how the government would respond to excessive yen declines.

The government will help small and midsize firms cope with the rise in costs through financial support and steps to boost their productivity, he added.

Japanese policymakers have historically welcomed a weaker yen as it makes the export-reliant economy’s goods more competitive abroad.

But domestic firms are also vulnerable to rising costs from a weak yen, given the country’s heavy reliance on imports for fuel, raw material and food.

Japan premier warns of negative impact on companies from weak yen

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Related Articles

More than 1,400 firms went bust last month in England and Wales

The number of businesses going bust in England and Wales jumped last month to its highest level since the start of the pandemic, as...

China launches second crewed mission to build space station

World59 minutes ago (Oct 15, 2021 11:06PM ET) 4/4 (C) Reuters. The Long March-2F Y13 rocket, carrying the Shenzhou-13 spacecraft and three astronauts in China's second...

U.S. offers payments, relocation to family of Afghans killed in botched drone attack

World22 minutes ago (Oct 15, 2021 09:55PM ET) (C) Reuters. FILE PHOTO: The Pentagon logo is seen behind the podium in the briefing room at...

Subscribe here

Latest Posts