The yen¡¯s plunge to a 20-year low threatens to leave it significantly weaker for years to come, shaking up global money flows and undermining Japan¡¯s efforts to get its fragile economy back on track.
The speed of the decline ¡ª the yen has slumped 11% against the dollar in seven weeks ¡ª has caught policymakers off guard and exposed divisions between a central bank intent on stoking inflation and a government facing a backlash over rising prices.
Currency trading has gone into overdrive while other parts of the financial markets are counting the costs. Companies have slashed sales of yen-denominated bonds they depend on to fund operations, and the returns that Tokyo-listed stocks offer international investors have plunged far into the red in dollar terms.
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