FOCUS: Japan Biz World Concerned over Yen's Plunge
Tokyo, June 14 (Jiji Press)--Japanese businesses across a variety of industries are increasingly worried about the ongoing rapid weakening of the yen, which would lead to higher materials and other costs.
In addition to importers, for which the yen's decline directly pushes down earnings, exporters, which normally benefit from the depreciation, are starting to show concern over the wild moves in exchange rates.
Electricity and gas suppliers, which import fuel such as coal and liquefied natural gas, are facing an additional blow from the cheap yen at a time when energy prices are surging due in part to Russia's invasion of Ukraine.
Kansai Electric Power Co. <9503> has set its internal exchange rate at 125 yen to the dollar for the fiscal year ending next March. Ordinary profit at the company is expected to fall by 8 billion yen if the dollar gains 1 yen from the assumed level.
Osaka Gas Co.'s <9532> ordinary profit is seen declining 660 million yen if the dollar surpasses the company's assumed rate by 1 yen. A source related to Osaka Gas expressed hope that the yen's rapid depreciation will subside, noting that the company could be forced to raise its gas rates if fuel costs keep increasing.
[Copyright The Jiji Press, Ltd.]