Strong Yen Hurting Japanese Economy – Forbes

Bank of Japan governor Masaaki Shirakawa warned on Monday that a surging yen and the European Union’s sovereign-debt crisis were slowing Japan’s post tsunami economic recovery.

The strong yen and the European financial crisis are related because as investors dump the euro, they look for what they feel are safe haven currencies like the Japanese yen and the Swiss franc. The Japanese are growing weary of the safe haven label because it has caused the Japanese currency to reach post-war highs compared to other currencies. The strong yen makes Japanese exports more expensive at a time when consumers in the United States and Europe are increasingly looking for bargains.

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Source: forbes.com