Yen Hits New Low Since 1986, Purchasing Power Halved Over 40 Years
The yen's exchange rate against the US dollar has fallen to its lowest level since 1986, with purchasing power halved over the past 40 years.
However, from the perspective of overseas investors, Japanese AI stocks appear more attractive, with the Nikkei 225 index rising 35% this year, significantly outperforming the S&P 500 (9.1%) and Nasdaq 100 (16.3%).
The rise is mainly driven by AI hardware stocks: Advantest +38.58%, Tokyo Electron +98.21%, Disco +49.88%, SCREEN Holdings +136.75%, Lasertec +50.27%.
However, for the Japanese public, the pressure from energy costs has significantly increased, as almost all energy is imported, and the weakening yen has led to higher household electricity expenses.
Source: Public Information
ABAB AI Insight
The continuous depreciation of the yen weakens purchasing power but enhances the competitiveness of export companies, particularly benefiting AI hardware stocks from global demand, with foreign capital inflow boosting the Nikkei's performance.
In terms of capital pathways, Japanese AI supply chain companies are relatively undervalued, attracting foreign investment, with semiconductor equipment stocks like Tokyo Electron seeing strong gains. Strategically, Japan leverages its technological advantages to occupy an important position in the global AI industry chain.
Similar to historical yen depreciation cycles, this trend shows differentiation under the AI theme, with export tech stocks benefiting while energy-dependent citizens face pressure, highlighting the dual impact of monetary policy and industrial structure.
Essentially, this represents a divergence between currency and industry; the yen's depreciation favors the export-oriented AI hardware industry, concentrating capital on Japanese companies with strong technological competitiveness while increasing domestic living cost pressures.
ABAB News · Cognitive Law
Currency depreciation benefits export companies but harms import-dependent citizens.
Under the AI theme, technology supply chain stocks are the first to benefit from global capital.
Exchange rate fluctuations amplify domestic industrial differentiation, with winners and losers coexisting.