This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Bearish Yen Equals Bullish Future for Toyota, Japanese Exporters

Stocks in this article: TMC HMC CAJ SNE

NEW YORK (TheStreet) -- Toyota (TM) and Honda (HMC) are among those Japanese companies having a happy holiday thanks to a yen that has fallen to a five-year low against the U.S. dollar, resulting in cheaper exports to America. Items priced in yen are now selling at the biggest discount since late 2008 based on the currency conversion rate.

Currency manipulation by Tokyo has certainly played a major role in helping the auto makers as well as such exporters as Sony (SNE) and Canon (CAJ).

When Prime Minister Shinzo Abe entered office in 2012, his strategy for economic growth, dubbed "Abenomics," focused on weakening the yen through the massive purchase of bonds by the Bank of Japan. That is much like the Federal Reserve's quantitative easing. Basic economics at work: The more supply without increasing demand, in this case the yen, the less it is worth over time. It has obviously worked for the Japanese yen.

The recent policies of the Federal Reserve have also helped the Greenback rise against the yen.

Around the time the Fed decided to reduce its quantitative easing last week, the Bank of Japan voted unanimously at its a two-day meeting to maintain its current level of easing, making for a bullish future for Japanese exporters.  

About the effects of the declining value of the island nation's currency, Governor Haruhiko Kuroda, the governor of the Bank of Japan, stated after the vote, "The correction of an excessively strong yen has been a plus for Japan's economy."

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,164.95 -251.90 -1.45%
S&P 500 1,994.99 -26.26 -1.30%
NASDAQ 4,635.24 -48.1670 -1.03%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs