(18 July 2024 – Asia) The finance ministers of Japan and Korea agreed to cooperate on stabilising their weak currencies amid overarching macroeconomic headwinds.
Japanese Minister of Economy and Finance Shunichi Suzuki and Korean counterpart Choi Sang-mok face population crises driven by rapidly falling fertility rates and are tasked with undertaking corporate governance reform initiatives. Choi proposed three key pillars of collaboration including policy cooperation, economic partnership and joint responses to global issues.
Domestic currency weakness may have provided a boost to Japanese and Korean exporters, but for the majority of corporates the lower value of the Yen and Won has been a negative development according to CT’s Paul Golden.
“It is essential to create an opportunity for both countries to thrive together by expanding the scope of bilateral economic cooperation into the corporate and private sectors, including capital market advancement and investments” Choi stated.
“The US dollar was mostly weaker overnight as the USD index fell to three-month lows. Most notably, the US dollar crumbled in Asia as the Japanese Yen surged, with the USD/JPY leading losses as it fell 1.3 percent” commented Convera Head of Market Insights, Steven Dooley.
The US dollar’s move lower followed comments by former US president Donald Trump who said he was concerned about the strength of the US dollar hurting exports. “We have a big currency problem,” said Trump.