What is 'JPY'?

JPY is the currency abbreviation or the currency symbol for the Japanese yen (JPY), the currency for Japan. The yen is made up of 100 sen or 1000 rin and is often presented with the symbol ¥. The yen was originally introduced by the Meiji government as a measure to modernize the country economically.


After the U.S. dollar and the euro, the Japanese Yen is the most traded currency in the foreign exchange market. The Japanese yen is also widely used as a reserve currency after the U.S. dollar, euro, and British pound.

The History of the Japanese Yen

In May 1971, the yen was officially adopted by the Meiji government and was first seen in 1872 when it replaced the mon currency of the Edo period. It lost most of its value by the end of World War II and was pegged to the U.S. dollar in 1949. When the U.S. went off the gold standard in 1971, the yen was devalued again and has been a floating currency since 1973, rising and falling against the dollar with international exchange rates. The yen, which is fundamentally a unit of the U.S. dollar, originated from Spanish pieces of eight - a common term in the American Colonies for silver coins worth approximately one ounce.

The Japanese Economy

Japan has a strong economy with a robust industrial base. Japan also has many technologically advanced companies from the auto manufacturing, machinery, steel and nonferrous metals, electronics, chemicals, shipping, textiles, and processed foods. According to Oanda, a leading currency data company, 13% of Japan's land is devoted to agriculture. In addition, Japan accounts for nearly 15 percent of the global fish catch, second to China. Japan's unemployment rate was 2.5% in February 2017.

The Strengthening of the Yen

The Bank of Japan (BoJ), Japan's central bank, is responsible for encouraging growth and minimizing inflation. Deflation, however, has been a problem for the nation for many years, and the BOJ has pursued a policy of low rates to stimulate demand and economic growth.

In 2018, the yen was reported to be one of the best-performing currencies that year by CNBC, and it was expected to exceed the U.S. dollar in terms of strength. Japan's performance in 2017 was strong due to global demand for its exports, government spending and liquidity from the Bank of Japan. The weakening of the U.S. dollar and Japan's growing economy are also cited as the reasons for the yen's appreciation. Morgan Stanley analysts considered that the yen was a better investment prospect as a safe haven compared to the U.S. dollar.



    1. Domestic Corporate Goods Price ...

      Domestic Corporate Goods Price Index Japan is an index that measures ...
    2. Japan ETF

      A Japan ETF is a type of exchange-traded fund that invests in ...
    3. Weak Currency

      A weak currency is one whose value has depreciated significantly ...
    4. USD (United States Dollar)

      USD is the currency abbreviation for the United States dollar, ...
    5. National Currency

      A national currency is a legal tender issued by a central bank ...
    6. Funding Currencies

      Monies that can be borrowed at low interest rates, making them ...
    Related Articles
    1. Investing

      From Mrs. Watanabe To Abenomics: The Yen's Wild Ride

      Relatively recent upstarts like the euro and the yuan may hog the currency headlines these days, but for sheer drama and gut-wrenching volatility, no currency can match the venerable Japanese ...
    2. Trading

      Volatility In The Yen Has Brought On Big Changes

      There's a difference between translation effects and the real effects that FX swings bring. We look at the difference, and how it's changing Japan.
    3. Insights

      Bank of Japan Tweaks Its Monetary Policy Stance

      Japan’s fight against deflation hasn’t seen much success and its central bank has decided on using a different monetary ‘weapon’ this time around.
    4. Investing

      An International ETF Idea for Bargain Hunters

      Japanese stocks look inexpensive compared to the U.S.
    5. Investing

      A Smart Way to Access Japanese Stocks

      Japanese stocks could be taking a turn for the better, and this ETF could lead the rally.
    6. Trading

      Currency fluctuations: How they effect the economy

      Currency fluctuations are a natural outcome of the floating exchange rate system that is the norm for most major economies. Read on for what effects these changes can have.
    7. Investing

      Japan ETFs Soar, but Investors Aren't Interested

      Japan ETFs are surging, but U.S. investors are not displaying much enthusiasm.
    8. Trading

      Currency All-Time Highs And Lows

      These four major currencies have seen some wild swings in the floating market since 1990.
    9. Insights

      The Relationship Between Japanese And Chinese Economies

      China counts on Japan for its manufacturing savvy, while Japan needs China's market to help it grow out of an economic funk.
    1. Is there a world currency? If so, what is it?

      There is no such thing as a world currency. However, since World War II, the dominant or reserve currency of the world has ... Read Answer >>
    2. What currency is affected by the interest rate decisions of the Bank of England (BoE)? ...

      The Bank of England (BoE) is responsible for the interest rate decisions that affect the economy of Great Britain. As with ... Read Answer >>
    3. How can I trade in cross currency pairs if my forex account is denominated in U.S. ...

      The forex market allows individuals to trade on nearly all of the currencies in the world. However, most of the trading is ... Read Answer >>
    4. How are international exchange rates set?

      Knowing the value of your home currency in relation to different foreign currencies helps investors to analyze investments ... Read Answer >>
    5. What are key economic factors that can cause currency depreciation in a country?

      Read about the causes of currency devaluation, and find out how to differentiate between relative and absolute currency devaluation. Read Answer >>
    Trading Center