Yen Weakness Measured by Japanese Curry Prices
A senior strategist at Bank of New York Mellon is using an unusual indicator to gauge the yen's weakness: the price of a popular Japanese fast food item. The 'Katsu Curry Index' aims to show just how far the yen has fallen since Japan intervened in the foreign exchange market.
The intervention, which took place recently, was intended to stabilize the yen but its effects are now wearing off, according to Bank of New York Mellon's strategist. To measure this weakness, the strategist is looking at the price of curry dishes from Japanese fast-food chains like Curry Dish.
The idea behind the 'Katsu Curry Index' is that when the yen is weak, it becomes more expensive for Japanese consumers to travel abroad or import goods, leading to higher prices for local products like curry. By tracking the price of these dishes, the strategist can get a sense of how far the yen has fallen.
August 12 marks one month since Japan's intervention in the foreign exchange market, and the effects are starting to fade, according to Bank of New York Mellon's senior strategist.