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The vast majority of Japanese companies expect the yen to firm against the dollar by year-end, a Reuters monthly poll showed on Thursday, suggesting further weakness in the local currency could catch businesses off guard.
The yen’s downturn this year, which accelerated in recent weeks, has burdened households with higher costs of everything from food to fuel. The rapid declines have also raised alarm among big companies and policymakers, making it difficult for companies to plan for the future.
The currency has lost about 20 percent versus the dollar since the start of this year, hitting a fresh 24-year low of just shy of 145 yen last week. The yen has been hammered against the dollar due to the growing gap between U.S. and Japanese interest rates.
“The yen has weakened so rapidly that it has meant a big impact on business management,” wrote a manager at one manufacturer in the automotive industry, responding on the condition of anonymity.
During the Aug. 31 – Sept. 9 survey period, the yen was trading in a range of 138-145 to the dollar.
The survey was conducted before Japanese authorities this week gave strong indications that they were uncomfortable with the currency’s sharp declines and appeared to be preparing to intervene to prop it up.
