Dollar/Yen: Not Looking Good

Things are not improving in the rate of exchange between the U.S. Dollar and the Japanese Yen.

According to Bloomberg.com:

The dollar fell to a three-week low against the yen on speculation the Federal Reserve will reiterate next week its intention to keep interest rates near zero, damping the appeal of U.S. assets.

The dollar dropped 1.5 percent to 81.88 yen yesterday from 83.13 yen on April 15, for a second weekly loss.

I just did a check on the rate at the Universal Currency Converter and it came up with this:

1.00 USD = 81.9320 JPY

The graph at left shows the downward trend in the rate of exchange between the U.S. Dollar and the Japanese Yen from 2007 to 2011. The dollar has not been at or above 100 yen/dollar since 2009. Before I went to Japan last December, my most recent trip there was in April 2007. At that time, I was able to get 116 yen per every dollar I exchanged. There is no indication that the dollar will recover any of its value anytime soon.

Unfortunately, this makes Japanese goods more expensive for Americans traveling to Japan. Likewise, this does not help Japanese companies (like Toyota, for instance) in their overseas sales to American buyers. This will not improve unless the U.S. Congress and President Obama gets serious in reducing the U.S. debt. That's why it is important for the Republican House of Representatives hold firm in cutting the $14 trillion debt and not raise the debt ceiling. All the insane spending during the previous two years has devalued the dollar. It is just "printing press" money right now.