USD/JPY EXPECTED TO TRADE BETWEEN 140-150 IN 2025, SAYS JAPANESE FIRMS

USD/JPY EXPECTED TO TRADE BETWEEN 140-150 IN 2025, SAYS JAPANESE FIRMS
USD/JPY Forecast: Approximately 60% of Japanese companies expect the USD/JPY exchange rate to trade between 140 and 150 in 2025.
Concerns About Trump Presidency: Nearly 75% of Japanese companies believe that a potential second term for Donald Trump would negatively impact the business environment, mainly due to tariff hikes and increased U.S.-China trade tensions.
Impact of Tariff Hikes: Trump's planned tariffs, including a 25% levy on goods from Canada and Mexico, could affect Japanese businesses.
Two-thirds of companies plan no strategic changes, while 22% might cut costs and 8% may expand into other markets.
Earnings Outlook: Half of Japanese companies expect higher earnings in the next fiscal year, with 20% anticipating a decline.
Increased earnings are expected from rate hikes, stronger freight rates, and a tourism boom.
BOJ Leadership Confidence: Over half of firms have confidence in BOJ Governor Kazuo Ueda's ability to normalize monetary policy, following the end of negative interest rates in March 2024 and the recent rate hike to 0.25%.
Survey Details: The survey was conducted by Nikkei Research for Reuters from November 27 to December 6, 2024, with 505 companies surveyed and 236 responses provided anonymously.