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Yen downtrend consistent with market fundamentals - Mr Toyoda
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Tuesday, 14 May 2013

Mr Akio Toyoda president of Toyota Motor Corporation said that the dollar's brief rise to JPY 102 is in line with market fundamentals.

Mr Toyoda, who was speaking in the capacity of chairman of the Japan Automobile Manufacturers Association, also said at the association's regular meeting that the dollar's faster rise against the yen is in sync with the Bank of Japan's monetary and currency policies that aim to pull Japan out of deflation.

He said that also pushing up the dollar are the positive signs emerging in the US economy.

Asked about what he considered to be preferable foreign exchange rates, Mr Toyoda declined to comment, saying only that optimal rates can be determined by various economic gauges and fundamentals.

Earnings at Japanese carmakers have recovered due to the yen's depreciation. But Mr Toyoda said the recovery also reflects efforts made by all of Japan's manufacturers.

He added that "Each carmaker has been struggling to cut prices as much as possible amid the extremely grim conditions in the wake of the financial crisis that erupted in autumn 2008."

He further added that while carmakers' earnings have expanded in tandem with the yen's decline, domestic capital investment and output capacity have yet to rise.

Source - Nikkei


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