A weaker yen has long been considered a boon for Japan¡¯s economy, helping blue-chip exporters such as Toyota Motor Corp. But that narrative is increasingly in question as the yen¡¯s recent plunge aggravates the impact of surging commodity prices, hitting some businesses and consumers much harder than before.
"The negative effects, or the risks from the weaker yen we¡¯re now seeing, are unprecedented,¡± said Eiji Hashimoto, chairman of the Japan Iron and Steel Federation. While steel-makers and other manufacturers benefited from past phases of yen weakness, the current spikes in energy and materials costs mean "this time it¡¯s totally different,¡± he said last week.
A weaker yen has been a mixed blessing for years, boosting exporters¡¯ competitiveness abroad and the value of their overseas profits when repatriated but also inflating costs for importers and making overseas acquisitions more expensive.
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