Katsu Curry Index Rattles Markets with Yen Undervaluation Claims
A new index aimed at measuring the yen's value is making waves in the financial world. Developed by Geoff Yu, a senior strategist at Bank of New York Mellon, the Katsu Curry Index takes into account the purchasing power of the Japanese currency as reflected in the price of curry dishes.
The Katsu Curry Index uses prices from CoCo Ichibanya, the world's largest curry-rice chain, with around 1,500 outlets globally. According to Yu's calculations, one dollar should buy just 62.18 yen, significantly lower than the current exchange rate of about 159.05 yen.
This suggests that the foreign exchange market is undervaluing the yen. The Big Mac Index, which uses the price of McDonald's hamburgers across countries, shows a similar discrepancy but with less severity, suggesting the greenback should buy 80.30 yen.