Expert views on the yen
How DBS, Nordea, Mizuho's chief market economist, the Japan Research Institute and others see the yen, each checked against this site’s data. Verdicts say which way the data point, not what will happen. Figures refresh every morning.
「The yen is far too cheap and will come back」
DBS says the yen remains undervalued on its equilibrium-rate model, though intervention has narrowed the gap. Nordea finds it significantly undervalued on OECD purchasing power parity and the Big Mac index.
The data: Broadly supported — but how and when is unclear- The yen's real value is at its lowest since 1970 (62.0).
- Across 26 countries, currencies 30%+ below average were +31% five years later (up 99% of the time) — but only 4 countries.
- Part of the recovery comes through prices (after 20%+ cheapness, +9% of the +16% real recovery came from the exchange rate). “Real” value can recover without the exchange rate moving.
Source: FXStreet, "Japanese Yen: Interventions signal valuation shift – DBS" (12 Aug 2026) / FXStreet, "Japanese Yen: Weak currency and cheap burgers – Nordea" (28 Aug 2026)
「A narrower US–Japan rate gap means a stronger yen」
Nordea says yen weakness will persist unless the rate gap narrows, for example through BoJ tightening. DBS cites the BoJ's greater room to raise rates as support for the yen.
The data: True of recent years; often false in the long run- Clear co-movement only in 2008–2012, 2021–2024.
- Over the whole period since 1976 the monthly co-movement is 0.15. In 1985–89 the monthly moves ran the other way (negative co-movement).
- The 2-year gap is 2.56% (-0.31 points on a year ago).
Source: FXStreet, "Japanese Yen: Weak currency and cheap burgers – Nordea" (28 Aug 2026) / FXStreet, "Japanese Yen: Policy-regime shift backs JPY against US Dollar – DBS" (14 Sep 2026)
「The digital deficit makes the weak yen structural」
“As long as Japan cannot stop depending on US platforms, the digital deficit will keep widening and keep pushing the yen down.”
The data: The digital deficit alone does not explain it- The digital deficit is ¥-6.5 tn over the last 12 months — and growing.
- But inbound tourism brings in ¥+6.2 tn, nearly cancelling it.
- The bigger yen-selling flows are corporate investment abroad (¥15.1 tn) and funds buying abroad (¥10.7 tn).
Source: Daisuke Karakama, Diamond Online (20 Feb 2024), in Japanese
「Japan runs a surplus, so the yen should be strong」
Japan's large surplus should support the yen, but the rate gap is cancelling it out. The opposing view is Daisuke Karakama's (Mizuho) “masked surplus”: much of the surplus never comes back as yen.
The data: Much of the surplus never comes home- The current account shows a ¥+35.8 tn surplus over 12 months, driven by income from abroad (¥42.1 tn), not exports.
- ¥11.2 tn of it is profit left with overseas subsidiaries and never becomes yen.
- After corporate and fund investment abroad, net yen demand is ¥-1.2 tn.
Source: FXStreet, "Japanese Yen: Weak currency and cheap burgers – Nordea" (28 Aug 2026) / Daisuke Karakama, Diamond Online (20 Feb 2024), in Japanese
「The new NISA keeps individuals selling yen」
Estimates that the new NISA will send ¥0.7–3.9tn a year abroad, pushing USD/JPY up by ¥1 to almost ¥6 by 2027.
The data: The flow is real — about the size of a trade deficit- Investment funds bought ¥13.6 tn abroad in 2015, the most since records began in 2014. Last 12 months: ¥10.7 tn.
- That is larger than the goods-and-services balance over the same 12 months (¥-2.0 tn).
- Fund flows include money outside NISA. If individuals switch back to Japanese stocks or deposits, the flow reverses.
Source: Japan Research Institute, on the new NISA's pressure on the yen (19 Jan 2024), in Japanese
「The rate gap and fiscal worries could take the yen to 200 per dollar」
Reported that some traders have begun to consider ¥200 per dollar as a worst case, citing the wide rate gap with the West and worries about Japan's public finances.
The data: The data lean against it — but these levels have few precedents- ¥200 would be a further 27% fall from ¥157, with the yen's real value already at its lowest since 1970.
- Across 26 countries, currencies 30%+ below average kept falling over five years in 1% of cases.
- Foreigners hold only 7.9% of government bonds, which limits the risk of a foreign sell-off. The BoJ holds 47% and is buying less.
Source: Bloomberg (Japanese edition), on traders eyeing ¥200 per dollar (1 Jul 2026)
Updated 29 Sep 2026 12:04 JST · real effective rate to Jul 2026 · balance of payments to Jul 2026