Revitalizing Japanese Economy: Excessively Weak Yen Undermines National Strength / Firms Must Adopt Proactive Investment Mindset |
Editorial
15:33 JST, January 8, 2026
Coming out of a long tunnel of stagnation, this New Year signals the start of change. The transformation of the Japanese economy cannot be achieved by a single policy alone. The future lies beyond the path of carefully crafted measures that have been put in place one after another.
Companies must break away from their contractionist tendencies and move forward.
To that end, it is necessary to first reaffirm that the world surrounding the Japanese economy has significantly changed.
The so-called “lost 30 years” — marked by stagnant prices, wages and interest rates — can be said to have been inseparable from a phobia of the yen appreciation.
Being put on the defensive, companies have been busy with their cost-cutting efforts and lost their entrepreneurial spirit to take risks and develop new products and services.
Today’s issues are not the strong yen but the weak yen, not deflation but inflation. Companies must not remain trapped by fixed notions and values.
The era of ultralow interest rates has ended. The Bank of Japan raised its policy rate to around 0.75%, the highest level in about 30 years. Long-term interest rates have exceeded 2%, reaching their highest level in about 27 years. The Nikkei Stock Average is trading at a high level, exceeding 50,000.
Meanwhile, the exchange rate hovers at around ¥156 per dollar. Compared to 2011, when it reached its........