Former Vice Finance Minister Eisuke Sakakibara says that while doubts over the global economy are strengthening the yen the currency probably will not gain enough to hurt Japan's exporters.
There is a high probability the yen will shift to a range between 110 and 115 per dollar by the second half amid demand for haven assets, said Sakakibara, who was nicknamed "Mr. Yen" when he oversaw currency policy from 1997 to 1999. The yen rose to as high as 116.51 last week for the first time since August amid turmoil in global markets as Chinese growth stutters.
"When there's uncertainty in the overall global economy, safe currencies like the yen are bought — and there's a good chance the yen will strengthen further from here," the 74-year-old, who is currently a professor at Tokyo's Aoyama Gakuin University, said in a recent interview. "As long as the yen doesn't break 100, there won't be a problem. If it's at 105 or 110, Japanese exporters are still highly competitive."