Nearly two decades after America rolled out its strong-dollar mantra, Japan seems to have adopted the opposite chant. Finance Minister Taro Aso reminded reporters Tuesday about the yen's vital role in boosting job and wage growth: In the opaque world of currency predictions, that counts as a pretty clear sign that he expects the currency to drop even further than its current rate of 120 to the dollar, down 16 percent since mid-year.
How low might the yen go? Opposition lawmaker Takeshi Fujimaki, a former banker, may be off-base when he warns the currency could eventually hit 200 per dollar. But with growth faltering and Prime Minister Shinzo Abe doing far more talking than restructuring, Japan is depending on a weaker exchange rate to boost export earnings. A rate nearer to 150 is hardly out of the question.
There's a view in Tokyo — and a certain tolerance in Washington for it — that if a weaker yen helps Japan whip deflation, then the end justifies the means.