Yen at 40-year low reveals Japan’s deepening monetary policy constraints
The Japanese yen has fallen to its weakest level in nearly 40 years, breaching 160 per dollar for the first time since 1986. This decline, driven by high energy import costs and a significant US-Japan interest-rate gap, limits Tokyo's ability to raise rates. Without addressing structural challenges, the yen is likely to remain under pressure, impacting global trade.