JAKARTA - The Japanese yen dropped to a new 10-month low on Thursday, November 20, after U.S. Federal Reserve minutes showed a December interest rate cut is now unlikely. 

That sent the dollar higher and put more pressure on the yen, which fell to 157.48 in Asian trading. 

The slide worsened after Japan’s Finance Minister Satsuki Katayama said she did not discuss the currency with the Bank of Japan this week, signalling no immediate plan to support it.

The yen has dropped about 6% since Prime Minister Sanae Takaichi took office on October 21, partly due to concerns over how much Japan will need to borrow to fund her stimulus plans. 

Even though Japanese bond yields are rising, the currency keeps weakening, and some analysts say confidence in Japan is slipping. Officials in Tokyo voiced concern on Thursday, with Chief Cabinet Secretary Minoru Kihara calling the moves “sharp” and “one-sided.” 

The dollar’s strength was felt across the market. The Fed minutes showed “many” policymakers oppose cutting rates in December, causing the euro, sterling, Australian dollar and New Zealand dollar to fall. 

A cheaper yen does not just affect markets, but it also directly touches people on the move. For migrant workers in Japan, a weaker currency means the money they send home buys less, effectively shrinking the value of remittances for families in Southeast Asia and beyond.

For foreign workers considering Japan, lower real wages in home-currency terms could make the country a less attractive destination compared to places like South Korea, Taiwan, or Australia, where earnings convert more favorably. But for Japanese citizens travelling or studying overseas, the weaker currency makes flights, tuition and daily expenses abroad much more expensive.

The tourism sector is, however, seeing the opposite effect. A weak yen makes Japan cheaper for foreign visitors, potentially boosting inbound tourism as hotels, transport and shopping become more affordable. 

Takaichi’s stimulus plan is a massive economic package worth about ¥13.9 trillion (roughly US$92 billion), designed to help Japanese households deal with high inflation and the rising cost of living.