Washington Must Act to Strengthen the Dollar (Asahi Shimbun, Japan)

The odd set of circumstances that has led to a credit downgrade of U.S. debt, a weakened dollar and hence a stronger yen, is setting off alarm bells in Tokyo and around the world. This editorial from Japan’s Asahi Shimbun explains the phenomena to readers and comes close to begging Washington to do something to reverse the trend, which is damaging Japan’s post-quake recovery.

The Asahi Shimbun editorial says in part:

The government is relying on exports to speed recovery and reconstruction after the Great East Japan Earthquake of March 11. But the strong yen stands in the way. It is significant that the authorities sent a strong message to firmly control excessive moves by the market.

However, Japan alone has limited influence. We urge the government to work closely with American and the major European countries. The government must implement comprehensive measures to lift the economy and reinforce its strategy for growth.

?The recent strengthening of the yen is not a result of investor faith in the Japanese economic growth. Rather, it is the difficulty the U.S. government has had raising its debt ceiling, resulting in a loss of confidence in U.S. Treasury bonds and the dollar.

The U.S. government is in an unusual position. Due to domestic political turmoil, a possible debt default and drop in its credit rating has permitted its currency situation to get out of order. Washington should clarify its position on protecting the value of the dollar, which is a key currency, to bring market speculation under control.

READ ON IN ENGLISH OR JAPANESE AT WORLDMEETS.US, your most trusted translator and aggregator of foreign news and views about our nation.