---
title: "QUICK SPARK: The Japanese Yen Hasn't Been This Weak In 40 Years"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/293347423.md"
description: "The Japanese yen has weakened to its lowest level since late 1986, trading at 162.77 per dollar. This decline is driven by the significant interest rate gap between the Federal Reserve and the Bank of Japan, which fuels carry trade activities where investors borrow cheap yen to invest in higher-yielding dollars."
datetime: "2026-07-21T13:05:34.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/293347423.md)
  - [en](https://longbridge.com/en/news/293347423.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/293347423.md)
---

# QUICK SPARK: The Japanese Yen Hasn't Been This Weak In 40 Years

The Japanese yen has slid to its weakest level since late 1986. As of Tuesday morning, it took 162.77 yen to buy a single U.S. dollar, a level unseen in nearly four decades.

Over the past five years, the dollar has strengthened by nearly 50% against the yen, driven by the wide interest rate gap between the Federal Reserve and the Bank of Japan.

The mechanism behind the move is called the carry trade. Investors borrow yen cheaply at Japan’s low rates and park the cash in dollars that pay far more, pocketing the difference.

Over the last twelve months, the **Invesco CurrencyShares Japanese Yen Trust** (NYSE:FXY) has lost nearly 10%.

_Image: Envato Elements_

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