The Japanese Yen has depreciated sharply through 2001against the US dollar. The currency hit its lowest level in over three years against the dollar pushing above ¥135 in late January. Japan is a recession-hit economy suffering from weak demand, falling consumer spending and accelerating deflation. With Japan's deepening economic woes there is a bleak outlook for the strength of the Yen for 2002 and 2003. Currently Prime Minister Koizumi and the Japanese government are about to release an …showed first 75 words of 473 total…

…showed last 75 words of 473 total…According to the Purchase Price Parity model (PPP) deflation in the Japanese market should make the Yen stronger relative to the US dollar. With the decreasing output of the Japanese economy, the low interest rates and the increase in the money supply will affect the Yen negatively. Therefore the outlook for the Yen for 2002 and 2003 will be neutral to weakening Yen. Chart from Pacific Policy Analysis Computing & information Facility in Commerce, Univ. of British Columbia