Japan's Executives Sound Alarm on Weak Yen Risks to Economy

Japanese executives are warning of risks to their economy due to currency swings and a persistently weak yen. The comments come as the yen hit a 40-year low in July, prompting a joint Japan-U.S. currency intervention that lifted the yen by around 5%. While a weaker yen has advantages for exports, it also increases costs for energy, materials, and food, which weigh on domestic demand.

Chief Financial Officer of Mitsubishi Electric Kenichiro Fujimoto said 'Problems affecting the entire Japanese economy affect us too. A weak yen does not necessarily mean all is well.'

Norihiko Ishiguro, chairman of the Japan External Trade Organization (JETRO), noted that 'While a weaker yen has real advantages for exports, Japanese companies import almost all their raw materials. At a certain exchange rate costs actually increase, so we can't say exporters always win from a weak yen.'

CFOs at Mitsui & Co and Mitsubishi Corp said they would like to see market stabilization and reduced volatility.