The Japanese yen was traded at USD 1 equivalent to 360 yen. In 1944, Japan was part of Bretton Woods’ssystem that set obligations for each country to adopt a monetary policy to maintain the pegged exchange rate within 1% range. It is also one of the popular currencies kept as a reserve after US Dollar, Euro and Pound (OANDA Corporation, n.d.). It is regarded as the third most traded currency in the foreign exchange market. Japan’s official currency is called yen and denoted by ¥. Having a thorough study can give more profound insight into some important elements of its economic conditions and international trade environment. From the surface, those changes and differences are interesting to be known. Subsequently, its currency value and power has also never been strictly stable. In the last decade, Japan’s economy has seen some fluctuations in its growth magnitude. Especially, most of the study will be done in the domain of exchange rates and their currency. Being one of the economic powerhouses of the world, Japan’s dynamic contribution to globalization and international trade has been immense, which is why we are motivated to learn more about it through this project. However, since the last five decades or so, it has been on a developmental journey to the top of the world. Japan has been through many difficulties in the past. However, the plan to increase sales tax can create some drastic changes in the economy (BBC News, 2019). The expansion of GDP due to falling imports assumes that Japan will have a stronger GDP than expected in 2019. The growth in Japan’s economy has been slow and expected to further contraction by several analysts. The policy brought under Prime Minister Abe called “Abenomics” has made some reforms but severe issues such as shrinking population and higher aging rate draw new economic challenges (The Heritage Foundation, 2019). There have been several economic concerns in Japan with a frequent recession, deflation and low consumer spending. It also had a history of change in leadership but from 2012, the leadership of Prime Minister Shinzo Abe has brought stability into the nation. Despite being such a developed country, its growth has been very low (1.7%) in recent years. The country has around $42, 832 per capita income while GDP is around $5.4 trillion in 2017. With a highly-skilled labor force, it is considered as one of the highly developed countries in the world along with a high standard of living shown by the human development index (HDI).

Japan is an island country located in East Asia.

Value of yen