Japan's current economic policy is essentially a defensive national strategy. Faced with domestic inflation pressures, the government has no room to continue printing money to subsidize exports, and raising taxes touches political bottom lines. Increasing tax burdens means losing votes, which is not a result any ruling party wants.

The problem is that Japan's economic lifeline cannot escape dependence on foreign markets. Cars, semiconductor equipment, precision machinery—these key industries rely entirely on exports for their livelihood. Unlike the US, which has a steady influx of immigrants to supplement the workforce, Japan faces severe aging population issues, and domestic consumption growth has little room for imagination. To maintain GDP size, exports are the only way out.

The yen's depreciation is not accidental. It is a direct result of the ultra-loose monetary policy of Abenomics. The current government has inherited this framework, making economic growth the core of its political achievements. Under this logic, yen appreciation is simply incompatible with national conditions and will not become a long-term policy goal.

The recent wave of rate hikes? Limited in scope, and market expectations for such adjustments have long been digested. There is no sign of the so-called "Mrs. Watanabe" massively liquidating overseas assets and frantically converting back to yen to pay off debts. Foreign exchange does not see panic-driven repatriation, so the yen exchange rate cannot rise naturally.

What truly sustains carry trade is not just the interest rate differential but also the long-term weak yen outlook. Continued yen depreciation benefits everyone—carry traders are happy, export companies are comfortable, and the ruling team's loose policy direction can also be justified. This is almost an irreversible chain reaction.

In simple terms, the trend of yen depreciation is already set.