The Impact Of The Japanese Devalue Their Yen

Submitted By tayjenk
Words: 353
Pages: 2

If the Japanese devalue their yen, it not only affects Japan, but the US as well. First, it brings down imports for the Japanese because everything outside of Japan is much more expensive. The US imports will rise because importing say rice will be cheaper than importing rice from China because the value is lower in Japan. Therefore Japan will be exporting more, because for other countries, it is cheaper for them to import Japanese goods since the value went down in Japan. This then leads to Jobs. Jobs in Japan will be going up because they will be exporting more goods, which will mean they will be producing more. Their wages will be lower, but there will be more work. For the US, jobs will be decreasing because the US will be doing less exporting. They will be receiving more goods from Japan because of the value of the yen lowering, and they therefore have no reason to export out to them, because they will be paying less of what they would previously because of the declined value. The US would be losing money. This therefore takes away jobs because the US will not be producing as many goods as they would if they were exporting. The GDP in Japan will go up, because they will be producing more because of their rise of exporting. The goods be created that are essential for Japan to export will be exported at an even higher rate because of the lessened value, which creates a much higher demand from other countries and a higher supply from them. For the US it is the opposite.