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Bloomberg

South Koreans are celebrating after the yen fell to its lowest level against the won in 15 years. They are travelling to Japan in their hordes and almost doubling their purchases of Japanese goods.
But for Park Hanul, the picture is not quite as rosy. The 32-year-old Seoul-based employee at a firm that provides aid programmes bought about 110,000 yen (US$743) over the past month as a side investment. So far, at least, it has not worked out as she expected.
“I was hoping the yen’s value would go up fast,” Park said in a phone interview.
Park is among a legion of South Korea’s retail investors who are betting the Japanese currency’s slump must end. Yen deposits at South Korean banks jumped to a record in October, according to the latest Bank of Korea data.
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The yen dropped to its lowest against the won since 2008 on November 16. While it has gained nearly 3 per cent from that low, it is still down 9 per cent this year.
Park says she is willing to put a further 3 million won (US$2,303) into the yen if the Japanese currency keeps weakening.
The optimism reflects expectations that Japan’s central bank will soon start raising interest rates. As much of the rest of the world tightened policy in a bid to tame inflation, Japan went the other way, keeping its policy rate below zero to spur further price rises in an economy that had been beset by deflation.
Investors have kept their focus on the yawning interest rate gap between Japan and its peers, which makes currencies in countries with higher yields look a better bet. Leveraged funds increased their net short positions on the Japanese currency to the most since April 2022 in the week ended November 14. before paring it slightly in the following week.


T. Rowe Price. is betting the yen will remain weak due to its wide rate gap with the US. The “yen may strengthen from 30-year lows versus the US dollar but we do not foresee that interest-rate differential narrowing significantly, the weak yen should continue,” Daniel Hurley, a portfolio specialist for emerging market and Japanese equities, wrote in a note last week.
Despite this cautiousness, South Korean retail investors still see opportunities in Japan. Improving relations between the two nations may partly explain the interest.
Korean President Yoon Suk-yeol has sought to boost ties with Japan after disputes surrounding Japan’s colonial rule of the Korean peninsula flared under his predecessor. Leaders of the two countries held the first formal summit since 2011 on Japanese soil in March this year. In June, Japan reinstated South Korea as one of its preferred trading partners and agreed to restore a foreign currency swap arrangement worth as much as US$10 billion.
South Koreans bought the most Japanese equities this year since data became available in 2011. That can be another way to bet on the yen, as unhedged stock purchases benefit if the currency rises.
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And inflows into a BlackRock Inc. exchange-traded fund that tracks long-dated Treasuries – but is priced in yen – quadrupled in the second quarter from the previous one.
South Korean tourists to Japan from January to September jumped almost five-fold from the same period last year, close to pre-Covid levels, while travels to other countries were seen still recovering, according to data from the Korea Tourism Organization. Direct purchases of Japanese goods have nearly doubled through the past three years of the yen’s relentless fall, while that of the US eased over the same period, according to the nation’s statistics office.
Lee Joon-gyu, 26, who works in interior design in Seoul, says travelling to Japan is now cheaper than going somewhere in Korea. He booked a trip to Nagoya on a whim just two weeks in advance, and plans to stock up on clothes and liquor while there. His 1 million won gave him 115,000 yen based on last week’s exchange rate. Just two years ago, the same amount of won would have handed him 96,000 yen.

For the yen investors, there is also hope things might change. Some investors expect the Federal Reserve to lower interest rates next year, which should help the Japanese currency. Growing inflation pressures in Japan are adding pressure on the Bank of Japan to end its ultra-loose monetary policy, which it kept unchanged last month. Its next policy decision is on December 19.
Pacific Investment Management Co., which manages nearly US$2 trillion of assets, is buying the yen on a bet the BOJ will have to raise rates.
“Inquiries on the yen at our sales desks have increased quite a lot,” said Moon Junghiu, an economist at KB Kookmin Bank, a South Korean lender.
And despite her yen investment not working out so far, Park, the retail investor, is not concerned.
If the Japanese currency does not rise, “I’ll just use it for my next trip to Japan,” she said.


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South Korea

South Koreans cheer Japanese yen’s 15-year low by binge shopping and investing in currency

A worker holds samples of Japanese yen banknotes at a factory producing Bank of Japan notes. Photo: Reuters

Visitors at Asakurayama Sengen Park in Fujiyoshida, Japan, where the iconic Mount Fuji can be seen. South Korean tourists have been flocking to Japan recently amid the yen’s weakness. Photo: Kyodo

Is Yoon silencing South Korean media under the ‘thinly veiled’ guise of fighting ‘fake news’?

South Korea’s President Yoon Suk-yeol. Photo: AFP 

Yoon Chang-hyeon (left), head of the National Union of Media Workers, is interviewed by Park Chan-kyong in Seoul in November 2023. Photo: Handout

Yoon Chang-hyeon (left), head of the National Union of Media Workers, is staging a sit-in in Seoul. Photo: Handout

A television reporter in Seoul. Conservatives are seeking to privatise South Korea’s two 24-hour news channels, YTN and Yonhap News TV. Photo: Shutterstock 

South Korea’s President Yoon Suk-yeol has in recent months targeted his critics. Photo: AFP 

Young Japanese trapped by outdated work culture seek greener pastures abroad: ‘I want some freedom’

Pedestrians in Shinjuku, Tokyo. Japan is facing a labour shortage but the country’s outdated corporate culture is pushing more young Japanese to look elsewhere for jobs. Photo: EPA-EFE

People wait in front of an electronic stock board showing Japan’s Nikkei 225 index at a securities firm on Monday. Anecdotal evidence suggests that more young Japanese are leaving to seek employment abroad. Photo: AP

Office buildings are illuminated at night in Tokyo. Young Japanese who have spent time abroad say they are shocked by the different attitudes towards work in Japan and Europe. Photo: Bloomberg

Two young women outside Shinjuku station in Tokyo. Women in Japanese corporations often find it difficult to balance a career and family and have to sacrifice one for the other. Photo: AFP

South Korea fights bedbug outbreaks amid tourism boom: ‘it itches madly’

Tourists wearing traditional Korean dress seen in Seoul. Photo: Xinhua 

People shop at Namdaemun Market in Seoul. A total of 17 suspected bedbug reports have been filed from seven of Seoul’s 25 districts. Photo: EPA-EFE

Bedbug bites can lead to skin rashes, severe itchiness or allergic symptoms, causing economic and psychological damage, say Seoul city officials. Photo: Reuters

Why are Thai tourists often ‘sent back’ by South Korea? Thai PM Srettha investigates

Tourists at the Myeongdong shopping district in Seoul.    Photo: Reuters

Tourists crowd the popular shopping district of Myeongdong in central Seoul. Some 250,000 Thais visited South Korea in the first eight months of the year. Photo: EPA-EFE

Tourists wearing the traditional Korean hanbok cross a street near Gwanghwamun, the largest gate of Gyeongbokgung Palace in Seoul. Photo: Xinhua

Fortress Wall of Seoul in Namsan with Seoul Tower lit in green. South Korea was the top five travel destinations for Thais in 2023. Photo: Handout

News

Asia

East Asia

More South Koreans are travelling to Japan and increasing their purchases of Japanese goods amid the yen’s weakness
Others are investing in the yen and betting on its rise as they expect the Bank of Japan to raise interest rates soon


More South Koreans are travelling to Japan and increasing their purchases of Japanese goods amid the yen’s weakness.


Central banks

Currencies

Investing

Japan

South Koreans cheer Japanese yen’s 15-year low by binge shopping and investing in currency

More South Koreans are travelling to Japan and increasing their purchases of Japanese goods amid the yen’s weakness Others are investing in the yen and betting on its rise as they expect the Bank of Japan to raise interest rates soon

More South Koreans are travelling to Japan and increasing their purchases of Japanese goods amid the yen’s weakness

Others are investing in the yen and betting on its rise as they expect the Bank of Japan to raise interest rates soon