The national currency is the yen. Currency units of Japan. Yen. Japanese yen: exchange rate against the ruble and other world currencies
Today, the Japanese yen is considered an active trading instrument for the global foreign exchange market. In addition, it is included in the group of major reserve currencies along with the euro and US dollars.
Japanese yen: history of appearance and development
From 1600 to 1868, a very complex region called Edo existed in Japan. It included a variety of banknotes - copper, gold and silver coins, as well as banknotes. In addition, the currency of the central government was different from the 244 separate princely states that existed at that time. In addition, there were also fractional units. But due to technological progress and active economic development, such a system has become impractical.
The year 1871 was also marked by significant reforms. Around the same time, the yen appeared. Translated, this word means “circle”. At the time of its introduction, 1 Japanese yen was equal to 1.5 grams of gold. Interestingly, over the following years, the gold standard often changed depending on the economic situation in the country.
By the way, the yen was approved as an international currency only on May 11, 1953. It was on this day that the International Monetary Fund approved a resolution that equated this monetary unit to 2.5 mg of gold. At the beginning of its existence (from approximately 1949 to 1971), the Japanese currency was pegged to the US dollar. In those days, $1 was worth 360 yen.
But in the following decades several devaluations occurred at once. Very soon the yen became a much more valuable and stable unit.
It's no secret that the Japanese economy suffered significantly in 2011 due to the earthquake and related disasters. But, despite all the forecasts of experts, the yen not only did not fall in price, but, on the contrary, began to quickly rise in price. Naturally, the country's national bank took the necessary measures - several significant injections were made into the financial system. However, the Japanese currency is still quite expensive to this day.
Japanese yen: existing denominations
Today, both paper bills and coins are in free circulation in Japan. There are banknotes worth one, two, five and ten thousand yen. In addition, metal coins with values of one, five, ten, fifty, one hundred and five hundred yen are used in everyday life.
Japanese yen: exchange rate against the ruble and other world currencies
Today, one hundred yen costs approximately 0.98 US dollars. It is also important to know the exchange rate of the Japanese currency to other world currencies - one hundred yen can buy 0.76 euros.
As for the Russian ruble, the national bank offers the following rate - for one hundred Japanese monetary units there are about 31 rubles. By the way, for 10 you can buy about 100 yen.
Today, Japanese financial systems are considered a very profitable investment among business people. After all, historical data confirms that the yen has only grown in value throughout its existence. Therefore, some experts consider deposits in the most optimal option.
The national Japanese currency is one of the most popular in the world and today occupies an honorable third place, second only to the ubiquitous dollar and eurocurrency. Although its exchange rate is quite unstable and is often artificially regulated by the issuing country, this does not prevent it from being appreciated by many Central banks.
Japanese currency - what is it called and why
“円” is precisely this “respectful” hieroglyph that denotes the yen, the modern currency of the “Land of the Rising Sun.” In addition, another designation is accepted on the international foreign exchange market - JPY, as well as a digital code - 392.
Although the yen is a Japanese currency, its name comes from China. And in the original version it sounded like “yuan”. One of the currencies of China during the Qing Empire was small bars of silver, which was quite inconvenient. But already in the 18th century, Mexican and Spanish coins began to appear in the country, called “Western” and “silver” yuan. Some time later, the production of local silver coins was established in Hong Kong, which the enterprising Chinese immediately dubbed “Hong Kong” yuan. It was these coins that appeared in Japan, where they were called “en”. And in 1830, the Japanese launched their own production of coins, which were similar in weight and composition to Chinese (Hong Kong) coins. It is believed that the Japanese currency also received its new name from the shape of the coin, “en” - meaning “round, circle”. The fact is that previously Japanese money had a rather diverse shape - oval, oblong, rectangular, or even not completely defined (for silver and gold bars).
Yen - history of appearance
Until about the middle of the 19th century, a rather complex system of monetary payments existed in Japan. The fact is that, in addition to national banknotes, each of the more than two hundred and forty provinces of the country had its own currency, this caused great confusion in calculations. The new Japanese currency, the yen, put an end to all these discrepancies. In 1869, the first coin was minted, and just two years later a ban was announced on various “clan” banknotes with their gradual replacement and withdrawal from circulation. Thus, by 1879 the yen had become the only and full-fledged currency of Japan. At the same time, fractional division was adopted: 1 yen = 100 sen = 1000 rin. Later, in 1954, this division was abolished.
At different periods, the Japanese yen was tied to the gold equivalent, the British pound sterling, the American dollar - everything depended on the political and economic course of the country. Only almost a hundred years after its introduction, in May 1953, the World Bank set the parity rate of the yen at 2.6853 milligrams of pure gold, which allowed it to become an internationally recognized currency.
Banknotes
The Japanese currency in paper version has only four types of banknotes in denominations of one, two, five and ten thousand yen and were reissued many times. Japan's newest paper banknotes were issued in 2004.
The one thousand yen note features a portrait of Hideyo Noguchi, a Japanese microbiologist, on the title side, while the reverse side is decorated with a classic landscape of Mount Fuji, Lake Motosu and cherry blossoms; The bill is made in blue tones.
The two thousand banknote (by the way, symbolically issued in 2000) is green. The obverse depicts the gates of Naha City, and the reverse side features an illustration from The Tale of Genji by Murasaki Shikibu.
The five thousand yen banknote (2004 sample) is made in purple tones. On the front side of the bill is a portrait of Ichiyo Higuchi, a famous Japanese writer, author of novels and stories about the lives of ordinary Japanese. The reverse side is decorated with the painting "Kakitsubata-tsu", depicting irises, by Ogata Korin.
On the front side of the 10,000 yen banknote is a portrait of the Japanese writer, philosopher and translator Fukuzawa Yukichi. On the back of the banknote there is a statue of a phoenix from the Byodo-in Buddhist temple.
Coins
The Japanese currency, presented in the form of coins, is slightly more diverse:
- 1 yen- aluminum coin, released into circulation in 1955; the obverse is decorated with the image of a young tree and the name of the country of issue; On the reverse - the year of manufacture and denomination.
- 5 yen— cast from a copper-zinc alloy, has a denomination and ears of rice on the obverse, and the name of the country and year of issue on the reverse; A distinctive feature of a coin of this denomination is the presence of a round hole in the center of the coin, released into circulation in 1949.
- 10 yen- made of bronze, on the reverse of the coin there is a laurel wreath, year of issue and denomination, and the obverse is decorated with an image of the Phoenix Hall from the Buddhist temple of Bedo-in and the name of the issuer’s country; coins of this denomination were released into circulation twice - a feature of the 1951 production was the smooth side of the coin, while the 1959 ten yen had a ribbed edge.
- 50 yen- cupronickel silver coin with a hole in the center, released into circulation in 1967; The obverse has the denomination, the name of the country, as well as an image of a chrysanthemum; the reverse also contains the denomination and year of manufacture.
- 100 yen- also made of cupronickel in 1967, however, instead of a chrysanthemum, the obverse is decorated with an image of sakura.
- 500 yen- released twice, in 1982 and 2000; earlier coins have a smooth edge with the inscription “NIPPON 500”, and coins of 2000 have a side part with diagonal notches; On the obverse in both versions there is a denomination, the name of the country of issue and a paulownia tree, and the reverse contains the year of manufacture, denomination, images of bamboo and mandarin.
In addition, there are commemorative coins in denominations of 500 and 1000 yen. “Five Hundreds” are made from a bimetallic alloy and are dedicated to the 47 prefectures of Japan - they all have the same front side and original back. Thousand yen coins are made of silver and are dedicated to the Olympic Games.
Degrees of protection
Although most of the currency in circulation is newer notes and coins, all Japanese banknotes issued since 1885 are legal and accepted.
Like any monetary unit, Japanese currency has several degrees of protection: microtext, relief elements, various images with text that changes depending on the viewing angle, hidden images, watermarks placed in an oval window and corresponding to the main image. The new banknotes feature the latest security feature - the constellation Eurion.
Should I buy yen?
Well, we found out what the Japanese currency looks like, what it is called and where it came from. Now let's talk about how reliable it is and whether you should trust it with your savings. If you plan to profitably place your capital in order to generate income, then, of course, it is much wiser to open a deposit in rubles, dollars or euros, because banks offer fairly low interest rates on deposits in yen. However, the Japanese currency is unusually stable, and the country's leadership carefully monitors this. In the entire history of the yen’s existence, it has almost never fallen, so if your goal is not growth, but the preservation of funds, then a deposit in yen is an excellent solution.
Rate to world currencies
The Land of the Rising Sun uses a freely floating exchange rate. Today, the estimated exchange rate of the Japanese currency is:
- 1 RUB = 2.3724 JPY
- 1 EUR = 135.4485 JPY
- 1 USD = 124.1650 JPY
- 1 CHF = 132.0687 JPY
- 1 GBP = 189.9042 JPY
- 1 UAH = 5.9 JPY
- 1 BYR = 0.0084 JPY
- 1 KZT = 0.67 JPY
The yen (円 in Japanese) is the currency of Japan. It is the third most popular currency on the foreign exchange market, after the American dollar and the euro. The yen plays the role of a reserve currency after the US dollar, euro and pound sterling. The ISO code for 4217 yen is JPY and 392. The Western (romanized) symbol for yen is ¥, and in Japan it is written using the kanji system - 円. Although not inherent to the currency, large amounts of yen are counted multiplied by 10,000 (man, 万), similarly American money is often rounded to the nearest hundreds or thousands.
Origin
In Japanese, yen is pronounced "en", but the spelling and pronunciation of "yen" is standardized in English through Portuguese transliteration. Adding a letter y in the romanization of an obsolete spelling of the word that included the symbol kanaゑ(ye/we), examples of which can be seen in Yebisu, Iyeyasu and Yedo (although the pronunciation was e). The romanization of the yen became permanent.
Story
Introduction
The yen was introduced by the Meiji government in 1872 as a system reminiscent of the European one. The yen replaced the complex monetary system of the Edo period, which was based on the mon currency. The New Currency Act of 1871 led to the introduction of a decimal accounting system: yen (1, 圓), sen (sen 1⁄100, 錢) and rin (rin 1⁄1000, 厘). The coins were round and cast like in the West. Officially, the yen was worth 0.78 troy ounces (24.26 grams) of pure silver, or 1.5 grams. pure gold. The same amount of silver today costs 1,181 yen, and the same amount of gold costs 3,572 yen. The act also moved Japan to the gold standard. (Sen and rin were withdrawn from circulation at the end of 1953).
Fixed value of the yen compared to the US dollar
The yen lost value during World War II and the post-war period. After a period of instability in 1949, in order to stabilize the Japanese economy, the value of the yen was set at 360 yen per US dollar, according to the US plan that was part of the Bretton Woods monetary system. This exchange rate was maintained until 1971, when the US ended the gold standard, which had been the mainstay of the Bretton Woods system, and imposed a 10% increase in import costs, ushering in the changes that led to the floating exchange rate system in 1973.
Undervalued yen
By 1971, the value of the yen had declined significantly. The value of Japanese exports in the international market was very low, and imports from other countries were too expensive for Japan. This decline in value was reflected in the current account balance, which rose from the deficits of the early 1960s to US$5.8 billion by 1971. The fact that the yen and several other major currencies had fallen in value motivated US action in 1971.
Floating exchange rate of the yen and major currencies
Following US measures to depreciate the dollar in the summer of 1971, the Japanese government agreed to a new fixed exchange rate that was part of the Smithsonian Agreement signed at the end of the year. Under this agreement, the exchange rate was 308 yen to 1 US dollar. However, sticking to the new exchange rate under the Smithsonian Agreement was difficult due to supply and demand pressures in the foreign exchange market. In early 1973, taxes were eliminated and the world's largest nations allowed their currencies to float.
Japanese government intervention in the foreign exchange market
In the 1970s, the Japanese government and businessmen were very concerned that the rising value of the yen could harm export growth by making Japanese products less competitive, which would negatively affect industrial development. The government continued to intervene in the foreign exchange market (by buying or selling dollars) even after the agreement to float the yen in 1973.
Despite the intervention, market pressure continued to increase the value of the yen, temporarily stalling at 271 yen to US$1 in 1973 before the impact of the fuel crisis became felt. The increase in the cost of oil imports caused the value of the yen to rise to 290 - 300 yen in the period 1974 - 1976. The re-emergence of a trade surplus again reduced the currency's value to 211 yen in 1978. This currency appreciation was reversed again after the second fuel crisis in 1979, when the value of the yen declined to 227 yen by 1980.
Yen in the early 1980s
During the first half of the 1980s, the value of the yen did not rise, despite the fact that the current account surplus grew rapidly. From 221 yen in 1981, the average value of the yen changed to 239 yen in 1985. The rise in the current account surplus stimulated demand for the yen in foreign currency markets, but it was diverted by other factors. The large differential in interest rates, with US rates much higher than Japanese rates, and the continued deregulation of international capital movements led to large capital outflows from Japan. This capital outflow increased the supply of yen to foreign currency markets, as Japanese investors exchanged yen for other currencies (mostly dollars) to invest abroad. For this reason, the yen remained weak compared to the dollar, which triggered a sharp increase in Japan's trade surplus in the 1980s.
Impact of the Plaza Agreement
In 1985, significant changes began. Financial officials of developed nations signed an agreement (the Plaza Agreement) confirming that the dollar was overvalued (and therefore the yen was undervalued). This agreement, along with inconsistent supply and demand pressures in the markets, caused the value of the yen to soar. From a low of 239 yen to the US dollar in 1985, the yen rose to a peak of 128 yen in 1988, nearly doubling its value against the dollar. After some decline in value in 1989 and 1990, the currency rose again to 123 yen per US dollar in December 1992. In April 1995, the yen peaked at nearly 80 yen to the dollar, temporarily bringing the Japanese economy closer to the size of the US.
Years after the bubble
The value of the yen declined with biased stock market pricing in Japan, reaching 134 yen per US dollar in February 2002. The Bank of Japan, with its zero rate policy, discouraged yen investment by transport trading investors borrowing yen and investing in higher value currencies (thus further devaluing the yen). Foreign currency borrowing totaled 1 quintillion dollars in February 2007. Economists have suggested that the yen is undervalued against the dollar by 15%, and by 40% against the euro.
Coins
Coins were introduced in 1870. There were silver 5, 10, 20 and 50 sen, as well as 1 yen, and gold 2, 5, 10 and 20 yen. The gold 1 yen was introduced in 1871, followed in 1873 by the copper 1 rin, ½, 1 and 2 sen.
The copper-nickel 5 sen coin was introduced in 1889. In 1897, the silver 1 yen was withdrawn from circulation, and the sizes of the gold 5, 10 and 20 yen coins were reduced by 50%. In 1920, cupro-nickel 10 sen coins were introduced.
Silver coin production ceased in 1938, after which various base metals were used to produce 1, 5 and 10 sen coins during World War II. Clay 5 and 10 sen coins were issued in 1945 but did not enter circulation.
After the war, brass 50 sen, 1 and 5 yen were introduced between 1946 and 1948. In 1949, the current style of the 5 yen with hole was introduced, followed in 1951 by the bronze 10 yen (still in circulation).
Coins of denominations less than 1 yen became invalid on December 31, 1953, after the Small Currency and Fractional Payments Rounding Acts (Shōgaku tsūka no se iri oyobi shiharaikin no hasūkeisan ni kan suru hōritsu) .
In 1955, the current version of the aluminum 1 yen and nickel 50 yen coin without hole was issued. These were replaced in 1967 by the current copper-nickel coins, as well as the 50 yen coin with a hole. In 1982, the first 500 yen coins were introduced.
The date appears on the reverse side of the coin, and the name 日本国, Nihonkoku (Japan) and the kanji denomination are written on the obverse side, except for the 5 yen, where Nihonkoku is written on the reverse side.
The 500 yen coins are among the most valuable coins used in the world (approximately US$4.86, €3.12, and £2.46). The most valuable of the commonly used American coins (25¢) is worth approximately 26 yen; Europe's most valuable coin (€2) is worth 321 yen, and the UK's (£2) is worth 406 yen (April 2008). The Swiss 5-franc coin is currently (April 2008) worth about 505 yen, which is slightly more than the Japanese 500 yen coin. With such a high value, it is not surprising that the 500 yen coin has become a favorite target for counterfeiters. It was counterfeited in such quantities that in 2000 a new series of coins with security properties was released. Despite these changes, counterfeits continue.
For various significant occasions, commemorative coins of various denominations up to 100,000 yen are made of silver and gold. Although they can be used, they are more of a collector's item.
Instead of indicating the year of issue, as on all other coins, Japan's coins indicate the year of reign of the current emperor. For example, if a coin was issued in 2006, it will bear the date Heisei 18 (the 18th year of Emperor Akihito's reign).
Banknotes
Issue of yen banknotes began in 1872, two years after the currency was introduced. Throughout history, banknotes have been issued in a range from 10 sen to 10,000 yen.
Before and during World War II, various authorities issued yen banknotes, such as the Ministry of Finance and the National Bank of Japan. Japan's allies also produced some banknotes in the post-war period. Since then, the Bank of Japan has remained the sole banknote issuing authority. Since World War II, the bank has issued five series of banknotes. The current series, Series E, consists of banknotes in denominations of 1,000, 2,000, 5,000, and 10,000 yen.
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Determining Value
The relative value of the yen is determined in the foreign currency market by economic factors of supply and demand. The supply of yen to the market is governed by the desire of currency holders to exchange it for another in order to purchase goods, services or shares. Demand for the yen depends on the desire of foreign visitors to buy goods and services in Japan and on their interest in investing in Japan (buying financial stocks with yen).
Beginning in December 1931, Japan gradually moved away from a gold standard system to a managed currency system.
Japanese yen is the official currency of Japan. Bank code - JPY. 1 yen is equal to 100 sen and 1,000 rin, but in 1954 all coins with denominations less than 1 yen were withdrawn from circulation. Current banknote denominations are 10,000, 5,000, 2,000 and 1,000 yen. Coins: 500, 100, 50, 10, 5 and 1 yen. The name of the currency comes from the Japanese word "en", which means "round".
The front side of Japanese banknotes depicts writers and educators: 10,000 yen - a portrait of Fukuzawa Yukichi, 5,000 - Nitobe Inazo, 2,000 - Murasaki Shikubu, and 1,000 - Natsume Soseki.
Coins differ from each other in the material of manufacture and design. Made of nickel are 500 yen (on the front side there is a paulownia flower), 100 yen (sakura) and 50 yen (chrysanthemum). A 10 yen coin depicting the Phoenix Hall of Bedoin Monastery and a 5 yen coin decorated with an ear of rice are minted in bronze. 1 yen is made of aluminum and contains a symbolic image of a sapling. On the reverse side of coins, as a rule, the denomination and year of issue are indicated. 5 and 50 yen have a hole in the center.
In its current form, the Japanese monetary system and the modern yen appeared in 1871. Before this, there were gold, silver, copper and paper banknotes, both from the central government and from 244 separate princely domains. At the first issue of a single state currency, 1 yen was equal to 1.5 g of pure gold.
The abandonment of the gold standard in Japan occurred gradually: from 1910, the issuance of 10 Japanese yen in gold was discontinued, from 1924 - 2 and 5 yen, and from 1932 - 20 yen. In 1933, the Land of the Rising Sun finally abandoned the minting of gold coins, which was associated with the economic crisis. At the same time, Japan joined the “sterling bloc”, pegging its currency to the British pound. The outbreak of war with China led to devaluation. In 1937, the price of the yen dropped to 0.29 grams of gold.
Since 1939, Japan has reoriented the national currency from the pound to the US dollar. At the same time, the value of the yen dropped to 0.20813 grams of gold, which corresponded to 4.27 yen per dollar.
The Second World War completely destroyed the Japanese financial system. In August 1945, the dollar was already worth 15 Japanese yen, in March 1947 - 50, and in July 1948 - 250. At the same time, the yen was not freely convertible, and different exchange rates were introduced for different transactions. For some commercial transactions the price reached 900 yen per dollar.
Illustration: Central Bank of Japan
In 1949, the American occupation administration led by General Makarur took up the matter, bringing order to the financial sector and establishing a single parity rate of 360 yen per dollar. At the same time, the largest Japanese monopoly companies were fragmented, which served as an impetus for the development of competition and the economy as a whole.
By May 1953, the yen had become a recognized currency unit of the International Monetary Fund with a parity of 2.5 mg to gold. In 1964, without agreement with the IMF, the Japanese leadership abandoned currency restrictions, making the yen freely convertible. Successes in economic development led to a series of revaluations of the yen. By the beginning of the 1970s, it was already worth 308, in 1978 – 280 yen per dollar, and the period of greatest strengthening of the currency occurred in the mid-1980s.
Japanese stagnation began in 1991 with a series of bankruptcies of financial institutions. The Asia-Pacific crisis of 1997-1998 led to the weakening of the yen from 115 to 150 yen per dollar. However, the devaluation stimulated further development of exports, which again led to an increase in quotations. Already in 1998, the massive exodus of investors from the dollar caused a rapid rise in price of the yen from 136 to 111 within three days.
In 2002, Japan finally emerged from stagnation and a trend towards sustainable growth emerged. At the same time, the national economy is export-oriented, so the policy of the Bank of Japan is aimed at maintaining a cheap yen. To achieve this, the country introduces minimum interest rates and also uses foreign exchange interventions. In 2007, a number of economists suggested that the yen was undervalued by 15% against the dollar and by 40% against the euro.
At the end of autumn 2017, the yen exchange rate was hovering around 111 per dollar, which is close to the historically highest price for the entire period after World War II. One euro can be bought for 131.5 yen, and one Russian ruble for 1.9 yen.
The Japanese yen ranks third in the world in foreign exchange reserves after the US dollar and the euro. The Bank of Japan is responsible for issuing currency and conducting monetary policy.
The value of the yen is determined primarily by the high level of production in Japan - the country ranks third in the world in terms of gross domestic product after the United States and China, as well as a positive trade balance and negative (-0.7% in 2010) inflation. At the same time, the Japanese economy depends on the import of raw materials and energy resources, as well as on the demand for exported goods: electronics, cars, etc.