The Yen Moved 7 Points in a Week — Here’s Why Your Strategy Shouldn’t Have

On September 8, the dollar moved from around 160 yen to 153 in a matter of days. Toyota and Honda lost a currency tailwind they had been quietly leaning on. The Nikkei dropped 1,130 points the same day, as investors scrambled to reprice earnings that had never been as strong as they looked.

This keeps happening, and executives keep being surprised by it.

I have had some version of this conversation more times than I can count. A company’s numbers are good. Margins are healthy. Then the yen moves seven points and someone in the room says, unprompted, “well, that explains the quarter.” Nobody asked. It just came out, because everyone already suspected it.

That’s not a strategy. That’s a subsidy, and subsidies get withdrawn without notice.

The companies I respect most in Japan do not build their competitiveness on a favorable exchange rate. They build it on something the exchange rate cannot touch — pricing power that comes from actually being better. A product nobody else makes. A service level competitors cannot match. A brand people will pay a premium for regardless of what the yen is doing that week. When your advantage is structural, a currency swing is background noise. When your advantage is the currency, a swing is an earnings call you dread.

Here is the uncomfortable test. Ask yourself honestly: if the yen strengthened 10% tomorrow and stayed there, would your business still be competitive? If the answer is “we would need to renegotiate with suppliers” or “we would need to cut costs,” you already know where your real vulnerability sits. It was never the exchange rate. It was the absence of anything else to compete on.

I wrote about this in 2015, when the same fretting was happening over a weakening yen instead of a strengthening one. The direction changes. The dynamic does not. Executives spend enormous energy trying to predict a number they cannot control, and comparatively little energy on the one lever they can — how frequently they bring genuine value to market. Companies that innovate new products and services constantly do not need to forecast the yen, because they are not depending on it.

Bel Japon is a good illustration of what this looks like in practice. When I spoke onstage with President and CEO Aytekin Yildiz at a French Chamber of Commerce event in 2024, his point was blunt: innovation is not optional, and it is not someone else’s job. It is the only path to growth, and the alternative is decline.

The flagship Kiri Creamy Portion is exposed not just to exchange rate risk but also to inflation, which has been rising in Japan — it is made at Bel’s factory in Sablé-sur-Sarthe, in France’s Loire dairy region, and imported into Japan as-is. Everything built around it is not.

Kiri Fruits Blend, the fruit-and-cream-cheese line Bel Japon began manufacturing domestically in March 2024, added Apple & Pear and a returning Orange & Fig flavor this September (2026) — Marketing Director Roger Shepperdson described it on LinkedIn as a “Japan exclusive” range now large enough to rotate seasonally, the way any Japanese confectioner would. That same month also brought Kiri Petit Sweets, a cube-format dessert cheese that built momentum across the rest of Asia before finally launching in Japan exclusively through AEON.

Aytekin told me the model he is proudest of, though, is co-branding — pairing Kiri with established Japanese food and confectionery brands rather than launching solo. By his own count, it now produces 35 to 40 new items a year on unusually short development timelines, and he presented it internally at Bel’s Global Growth Forum as a best practice for the rest of the group. The September 2026 Kiri × Monteur collaboration — chocolate-coated strawberries and pretzels, sold only at 7-Eleven in Tokyo and Kanagawa — is one instance of it. Bel’s own corporate account has separately credited the broader approach with tie-ups involving Akagi, Lotte, Bourbon, and Tirol, some of the most recognizable names in Japanese confectionery. The French Chamber that gave Bel Japon its “Company of the Year” award in 2025 cited the co-branding push by name as one of the reasons. None of that came from France telling Japan what to sell. It exists because Bel Japon keeps resetting what Kiri is worth to a Japanese consumer, one new flavor, format, and partnership at a time, instead of waiting to see what the yen does to last year’s product.

The counter-case is just as instructive. During the Abenomics years, a weak yen handed exporters like Toyota and Nintendo a windfall almost for free. Economists at the time warned this was as much a trap as a gift — as BNP Paribas economist Azusa Kato put it, the story “sounds good, but there is always a ‘but’ that follows.” Companies that leaned on the weak yen instead of using the breathing room to actually change — Sony’s struggling TV business among them — found the advantage evaporated the moment the currency turned, and they had nothing else built to replace it. The yen was never the strategy. It was the anesthetic that let some companies avoid having one.

None of this means ignore currency risk entirely. Manage it, hedge what needs hedging, and then stop checking the exchange rate every morning like it is a scoreboard. The real work is elsewhere.

Stop trying to predict exchange rates. The best way to hedge against exchange rate risk is to increase your rate of innovation, because every time you innovate, you reset value. A currency move can erode the price of what you already sell. It cannot touch the price of something you have not offered before, because that price is yours to set.

These recent currency swings are certainly not the last to expose which companies are actually strong and which are just lucky. The question worth asking your leadership team is not “what will the yen do next” — nobody in that room can answer it credibly. The question is: what are we building that will not care either way?