I’ve read that Brexit has caused Yen to surge, and that is somehow bad for Japan economy.
When I read a bit more, it’s implied that the higher value of yen is bad for japanese exports. Why is that?
How exactly did Brexit affect Yen to surge in the first place?
I’m a layman when it comes to economics and the news I’ve read are terrible at explaining simple things.
>>1333849
Economics is a social science. We consider those pseudoscience on /sci/.
>>1333850
well, social science does have a word "science" in it, which is what’s in the title of this board.
Economics goes hand in hand with mathematics, so I guess this is the best board for this question.
Yen increase = higher export price = harder to sell. Japan goods are already expensive compared to China.
Idk maybe investors think EU is shit now and switch to buying other currencies instead of the Euro?
>>1333849
imagine I deal with euros.
I want to buy a japanese car.
the japanese manufacturer sells it to the car dealer for 1.5 million yen, which is say 10,000 euros. (150 yen = 1 euro)
Suddenly, the yen surges, increasing its value. Now 1 euro is worth only 100 yen (I'm simplifying here, these are not real values).
the car dealer now has to pay 15,000 euros for the exact same car, which means the car becomes more expensive for a european customer, which means its sales decrease.
->less imports from japan
->less exports for japan
On the flip side, everything japan imports becomes less expensive for them.
BUY
THE
DIP
