Key Facts
• January 2025: USD/JPY peaked at 139 yen; April 2025: dropped to 158 yen.
• Survey by Sankei Shimbun (July–August 2025): Ideal rate concentrated at 140–150 yen.
• 140–145 yen preferred by over 30%; 145–150 yen by nearly 30%.
• 23.1% of companies favored a stronger yen below 135 yen.
• Manufacturing and transport sectors showed higher preference for yen appreciation.
• Yen depreciation linked to Japan-U.S. monetary policy divergence.
• Bank of Japan (BoJ) maintains 0.5% interest rate; U.S. Federal Reserve (Fed) keeps higher rates.
• Market anticipates BoJ rate hikes and Fed rate cuts soon.
• Survey on ideal BoJ policy rate: 40% chose 0.5–0.75%, 32.3% chose 0.75–1.0%.
• Expected timeline for rate normalization: 40% predict by FY2025 or April–September 2026.
Summary
A survey by Sankei Shimbun revealed that major Japanese companies prefer an exchange rate of 140–150 yen per U.S. dollar, with over 60% of responses concentrated in this range. The survey, conducted from July to August 2025, highlights minimal demand for significant changes from the current rate. However, 23.1% of respondents, particularly in manufacturing and transport sectors, favored a stronger yen below 135 yen. The yen’s depreciation is attributed to the divergence in monetary policies between Japan and the U.S., with the BoJ maintaining low interest rates and the Fed keeping higher rates. Companies also indicated a preference for a gradual BoJ rate increase, with most expecting normalization by FY2025 or mid-2026. The findings underscore the cautious approach businesses are taking amid fluctuating exchange rates and monetary policy shifts.
