Seen in its proper context, the yen’s recent decline is a move back to its pre-crisis levels rather than the start of a currency war or a beggar-thy-neighbour policy.
The strength of the move since September last year has drawn plenty of criticism in the region, particularly from Korea, but the truth is that most Asian countries are net importers from Japan and are benefiting from the weaker yen, having suffered as a result of its sharp appreciation at the outbreak of the global financial crisis.
“Our word of choice is retracement’, says Standard Poor’s in a report released yesterday. “While the depreciation...
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