10:53 JST, May 19, 2024
TOKYO (Jiji Press) – A private sector survey found that 63.9% of Japanese companies are experiencing negative earnings impacts from the yen’s recent weakness.
About half of responding companies believe exchange rates of ¥110 to less than ¥130 per dollar are appropriate, according to the Teikoku Databank Ltd. survey. The dollar is currently trading above ¥150.
It is important to increase momentum for companies to reflect higher material costs in their product prices to ensure consumption growth, supported by continued wage increases and in companies’ capital expenditures, the research firm said.
Only 7.7% said the yen’s depreciation is a plus for their profits, while 28.5% see no impact.
The percentage of companies that saw yen weakness negatively impacting their sales and those that saw positive sales impacts were 35.0% and 16.0%, respectively.
One of the responding companies said: “We have failed to pass on higher prices of imported materials and energy to customers,” while another said an increase in sales prices to reflect higher costs led to a decrease in the demand from customer companies.
According to the survey, only 1.3% of respondents believe the dollar rate above ¥150 is appropriate.
Some called on the government to take measures to address the yen’s excessive decline.
Teikoku Databank conducted the survey online for six days through Wednesday, with 1,046 companies providing valid responses.
