All articles tagged with #currency fluctuations
The strengthening of the US dollar, driven by economic policies proposed by President-elect Donald Trump, is expected to have significant global repercussions. Historically, fluctuations in the dollar's value, primarily influenced by domestic US developments, have impacted economies worldwide. As the dollar potentially surges, it could pose challenges to economic growth in other countries.
Japan is being forced to scale back its historic five-year, 43.5-trillion-yen defense build-up due to the collapse of the yen, which has lost 10% of its value against the dollar since the plan was unveiled in December. The weak yen has led Tokyo to reduce its ambitious defense procurement plan, including cutting back on aircraft purchases starting in 2024. Japan's Ministry of Defense does not hedge against currency rate fluctuations, leaving it with few means to mitigate the rising cost of military equipment. The reduction in spending could impact Japan's ability to deter a Chinese invasion of Taiwan and raise concerns in Washington about its ally's defense capabilities.