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Why is the yen so high against the US dollar?

Asked by weeveeship (4665points) September 7th, 2010

Some background:
1. The exchange used to be around 90–100 yen (JPY) per US dollar (USD).
2. Japan is having severe economic problems
3. Japan’s government/Central Bank is rumored to run “dirty floats” to intentionally lower the yen’s value to spur exports
—>This is either not used right now or is ineffective. (not sure which)
4. Japan is having political problems and changes prime ministers often
5. The only reasons I can think of for the rise in the yen are A) trade surplus against the US (not really that big as US consumer spending itself has decreased), or B) people are speculating in Japan (not sure why anyone would do that given Japan’s problems)

Any insight you could give is appreciated.

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