Previously, Japanese Finance Minister Junichi Suzuki told the media that the government is paying close attention to exchange rate fluctuations with a high sense of urgency and does not rule out any options for excessive exchange rate fluctuations.
The Bank of Japan held a monetary policy meeting on March 19th, raising the policy interest rate from negative 0.1% to within the range of 0 to 0.1%. At the same time, it decided to end the yield curve control policy and stop purchasing trading open-ended index funds and real estate investment trusts. This is the first time in 17 years that the Bank of Japan has raised interest rates.
However, since the Bank of Japan announced its withdrawal from negative interest rate policy, the Japanese yen has not only not shown an upward trend, but has also experienced a rare situation of accelerated depreciation.
The Japanese yen has been heavily shorted!
According to the latest data released by the US Commodity Futures Trading Commission, the net short positions in Japanese yen held by global hedge funds and asset managers rose to 148388 in the week ending April 2, the highest level since January 2007.
With the large-scale short selling by international capital, the Japanese yen exchange rate was 152 yen per US dollar on the evening of the 10th, reaching the lowest level in 34 years since June 1990. And this morning, the yen fell to 153 yen.
Recently, Japanese officials have also frequently issued intervention signals. According to the Wall Street Journal, Fumio Kishida publicly stated that the Japanese government is closely monitoring foreign exchange trends and believes that excessive volatility is unacceptable.
Fumio Kishida said, "We hope to take appropriate measures against excessive volatility, and we will not rule out any policy options."
He also stated that he will cooperate with the Group of Seven (G7) to address exchange rate issues, and pointed out that the G7 has previously stated that the disorderly fluctuations in the Japanese yen exchange rate may have a negative impact on the global economy.
Previously, Japanese Finance Minister Junichi Suzuki also publicly warned of taking "resolute action" to intervene in the foreign exchange market.
However, market insiders believe that even if Japanese officials intervene, it will be difficult to achieve fundamental results, and the outlook for the yen's trend is still not optimistic, given the still large interest rate difference with the United States.
The number of bankrupt enterprises has increased significantly!
According to the Xinhua News Agency, a report released by the Tokyo Institute of Commerce and Industry, a Japanese private enterprise reputation survey agency, on the 8th showed that with the expiration of preferential loans issued by the government during the COVID-19 epidemic, the capital situation of some enterprises deteriorated, and the number of Japanese bankrupt enterprises increased significantly in fiscal year 2023 (April 2023 to March 2024).
The report states that in the previous fiscal year, the number of bankrupt Japanese companies with debt exceeding 10 million yen (approximately 152 yen per US dollar) increased by 31.58% year-on-year to 9053, and the total debt of bankrupt companies exceeded 2.46 trillion yen.
The report shows that the total debt of bankrupt enterprises has increased year-on-year for two consecutive years. In the fiscal year 2023, bankrupt enterprises were mainly small and medium-sized enterprises with fewer employees, and the number of bankrupt enterprises in all 10 industries increased year-on-year.
Relevant analysis points out that the main reason for the large increase in the number of bankrupt enterprises is that from 2023, the interest free unsecured loans issued by the Japanese government during the COVID-19 epidemic entered the centralized repayment period, and many small and medium-sized enterprises with poor performance were overwhelmed.
In addition, factors such as rising prices and wage increases in response to labor shortages have significantly increased the operating costs of enterprises.
The report states that due to the peak repayment of interest free and unsecured loans provided by the Japanese government to small and medium-sized enterprises during the epidemic period after April this year, it is expected that the number of enterprises facing financial difficulties will continue to increase.
