asked 89.0k views
3 votes
How will the depreciation of the Japanese Yen vis-à-vis the USD impact FDI from U.S. into Japan?

asked
User Jilly
by
8.4k points

1 Answer

3 votes

Answer:

Generally, when a currency depreciates, that results in higher foreign direct investment. I.e. if the currency of any country depreciates, investing in that country becomes cheaper for foreign companies, e.g. land, equipment or existing facilities are worth less if the investors brings an appreciated foreign currency.

In this specific case, if the yen depreciates, US foreign direct investment in Japan should increase.

answered
User Shu Rahman
by
8.8k points
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