What is Yen?
Yen is the official currency of Japan, and it is denoted by the symbol ¥. It is one of the most traded currencies in the world, along with the US dollar, euro, and pound sterling. Yen is subdivided into 100 smaller units called sen or 1000 smaller units called rin.
History of Yen
The yen was adopted as Japan’s official currency in 1871, replacing the mon currency system. The yen was based on the Spanish silver dollar, which was widely used in Japan during the 17th century. The currency was decimalized in 1872 with the adoption of the yen, sen, and rin system.
Yen Exchange Rate
The exchange rate of the yen can fluctuate due to various factors such as economic conditions, geopolitical events, and market sentiment. The Bank of Japan is responsible for setting monetary policy and interventions to stabilize the yen’s value in the foreign exchange market.
Examples of Yen
1. If you are traveling to Japan, you will need to exchange your currency for yen to make purchases.
2. Japanese companies often trade in yen for importing and exporting goods and services.
Case Study: Yen Appreciation
In 2016, the yen appreciated sharply against the US dollar due to safe-haven demand during the global economic uncertainty. This affected Japanese exporters as their products became more expensive in foreign markets, leading to a decrease in exports and economic growth.
Statistics on Yen
– As of May 2021, the exchange rate of 1 US dollar to Japanese yen is approximately 110 yen.
– Japan is the third-largest economy in the world by nominal GDP, contributing to the yen’s status as a major currency in international trade.
