What is the tendency with japanese product prices?

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The JPY has fallen by 15% from last year's rates. Is there a chance to see an adjustment of the market prices in the near future?

-- Paul Schilliger (pschilliger@smile.ch), April 03, 2001

Answers

Japanese prices should hold steady. See a recent article on the Japanese economy by George Will here.

So the question is whether importers will pass on the savings from the strong dollar to consumers. Usually they don

-- Stewart Ethier (s_ethier@parkcity.net), April 03, 2001.


I remember a couple of years ago when the japanese yen had fallen from about 100 to 150 per dollar - there was not the slightest change in price in any of the products sold in the US. I was very tempted at the time to take a vacation in Japan and buy over there!

-- Andreas Carl (andreas@physio.unr.edu), April 03, 2001.

Oh! All right... I was just asking...

Kidding put aside, I understand that the prices should not fluctuate too much in order not to destabilize the market. Nevertheless, I remember the letter I got from Pentax last year "Due to the rise of the JPY..." As Stewart suggested, I doubt there will be another letter this year "We are proud to announce to our dear customers..." :-)

-- Paul Schilliger (pschilliger@smile.ch), April 03, 2001.


Actually, the JPY has fallen from about 101 to the dollar in Feb. 2000 to about 126 today, almost 25%. It is unlikely you will see prices fall though, as this is a profit making opportunity. Remember, manufacturers also take a lot of the downside, which the rate moves adversely.

-- Mani Sitaraman (bindumani@pacific.net.sg), April 04, 2001.

When I was living in Japan for a few years, I saw the yen range between 102 and 146/dollar. US prices don't fluctuate much; a weaker yen merely means profits, when converted from dollars to yen, will be greater. One thing I learned is that market share is very important to Japanese companies. No manufacturer wants consumers to think it's raising prices...they'd rather absorb a loss than lose marketshare if it means profits in the long run (>> a fiscal quarter or even fiscal year). I think set US prices have a large cushion for currency fluctuations. You tend to see frequent rebates when the yen is weak to pass some savings along, and fewer rebates if the yen is strong to recoup for exchange rate losses. Yet, the listed price (say at B&H) is almost always constant. It gives the perception that prices aren't rising, even when the yen strengthens and news bulletins say to expect the prices of imports to rise.

-- James Chow (dr_jchow@yahoo.com), April 04, 2001.


When I was living in Japan for a few years, I saw the yen range between 102 and 146/dollar. US prices don't fluctuate much; a weaker yen merely means profits, when converted from dollars to yen, will be greater. One thing I learned is that market share is very important to Japanese companies. No manufacturer wants consumers to think it's raising prices...they'd rather absorb a loss than lose marketshare if it means profits in the long run (>> a fiscal quarter or even fiscal year). I think set US prices have a large cushion for currency fluctuations. You tend to see frequent rebates when the yen is weak to pass some savings along, and fewer rebates if the yen is strong to recoup for exchange rate losses. Yet, the listed price (say at B&H) is almost always constant. It gives the perception that prices aren't rising (a great way to scare off price-conscious US consumers), even when the yen strengthens and news bulletins say to expect the prices of imports to rise.

-- James Chow (dr_jchow@yahoo.com), April 04, 2001.

As you probably know, Japan is a country that lacks natural resources, meaning they have to import almost all things that go into making cameras such as: iron ore, oil, glass etc. Since most things sold on the international market are sold in USD the Japanese makers also have to buy all their raw materials in USD in turn selling their cameras and lenses in USD. So the assumed trickle down effect of high and low yen fluctuations are not as great as perceived when the import of raw materials is factured in. However the makers do make money on short term fluctuations, by buying raw materials when the yen is high, but the effect is more or less negated when the trends are over long periods. I'm not saying that the makers don't make a little more money when the yen is low--due to cheaper labour cost when exchange rates are factored in--but that the companies don't make as much as would be expected if the Japanese were able to produce their own raw materials.

-- Rene Bouchard (reneb@hotmail.com), April 04, 2001.

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