Why is the Yen So Strong Against the U.S. Dollar?FX OutlookAugust 17, 2010 Posted by Laurence HaywardYen interest rates are at 0.1 percent, the lowest in the world. The two things that determine the strength of a currency are its trade cash flows and its investment cash flows. Japan has a trade surplus, which means when the funds from overseas sales are repatriated, the Japanese have to buy yen, and this keeps the currency strong. Why then was the yen so weak, in the 120 range for so long?
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