Big trouble is lurking for the Japanese yen. It has crashed to a record low for the past 37 years.
According to Nikkei, the yen's exchange rate against the US dollar plummeted to unprecedented levels. Currently, the Japanese currency is trading near 160.39 yen per US dollar.
Experts estimate this is the lowest rate in 37 years. The last time such a rate was recorded was in December 1986. Such a collapse could be explained by the difference in interest rates between the Bank of Japan and Western central banks, which raised their rates to slow down inflation.
However, the Japanese regulator is striving to fix the situation, albeit with mixed success. The Bank of Japan is trying to stimulate the national economy with low rates. As a result, yen-denominated assets are less attractive compared to those denominated in dollars and euros.
Notably, at the end of March this year, the yen fell to 151.97 against the US dollar, the lowest value since 1990. Earlier, Naoki Tamura, a member of the Board of Governors of the Bank of Japan, approved a gradual increase in the country's key rate.
By the end of spring, monthly spending to rescue the national currency, which was becoming increasingly cheaper, amounted to 9.8 trillion yen ($62.23 billion). However, some analysts were optimistic about the yen's future. Preliminary forecasts suggested that the Japanese currency, which had become the weakest means of payment among developed countries' currencies, would not be allowed to fall below 160 yen per 1 US dollar.