Exchange rate intervention may not be able to prevent the yen from falling. Can cross-border sellers still maintain their profits?

Exchange rate intervention may not be able to prevent the yen from falling. Can cross-border sellers still maintain their profits?
It is learned that according to foreign media reports, on the evening of September 22, the Japanese Ministry of Finance announced that the government implemented exchange rate intervention on the same day due to the sharp fluctuations in the yen-dollar exchange rate . This is the first time that the Japanese government has intervened in the depreciation of the yen since June 1998.


▲ The picture comes from Yomiuri Shimbun
Since 2021, the Japanese government has been actively promoting the depreciation of the yen in order to promote export trade. With the continuous interest rate hikes by the Federal Reserve this year, the strengthening of the US dollar has caused the exchange rates of non-US currencies to fall out of fundamentals, and the already weak yen has begun to get out of control.

On September 22, the Japanese yen fell from 115 yen to the dollar at the beginning of the year to 145 yen , hitting a 24-year low . The year-to-date depreciation rate exceeded 25% .

▲ The picture comes from Sina Finance

In order to prevent the yen from continuing to fall, the Japanese Ministry of Finance intervened in the exchange rate at around 5:00 p.m. that day.



The scale of intervention is nearly 3 trillion yen, a record high




During the intervention, the Bank of Japan bought yen from commercial financial institutions and sold dollars to them in the name of the government. After this series of operations, the yen-dollar exchange rate once again rose to around 140 on the same day. However, the intervention only temporarily curbed the yen's decline. In just a few days, the dollar-yen exchange rate climbed back to the level before the foreign exchange intervention.


According to a report by Japan's Kyodo News on September 26, the scale of the Japanese government's intervention in the foreign exchange market on the 22nd may reach 3 trillion yen (about 14.78 billion yuan), exceeding the record of 2.6 trillion yen in foreign exchange intervention in 1998.


On the evening of September 30, the Japanese Ministry of Finance announced official data on foreign exchange intervention: from August 30 to September 28, 2022, the amount of foreign exchange balance operations was 283.82 billion yen , which was not much different from media forecasts.


▲ The picture comes from the Ministry of Finance official website

Industry insiders pointed out that although the sharp depreciation of the yen has temporarily eased, the probability of a significant rebound in the short term is very low . First, the Federal Reserve has hinted that interest rate hikes may continue until next year; second, the Japanese government is trapped by the reality of weak domestic demand and weak economy and can only stick to loose monetary policy.


The decline of the yen is not only reflected in the exchange rate with the US dollar, but also in the exchange rate with the RMB. As of the close of October 7, the exchange rate of the yen to the RMB was 0.0489 , a drop of nearly 30% compared with the peak in 2020 ! For Japanese cross-border sellers, the Japanese e-commerce market has become saturated in recent years, and the internal circulation is serious. The depreciation of the yen is undoubtedly worse.



The yen has depreciated significantly, and the cost of reverse calculation remains high




The unstoppable exchange rate decline, coupled with the reverse calculation customs clearance policy that Japan Customs has continuously improved in recent years, has caused the cost of cross-border e-commerce to continue to rise, and the profit to shrink. For sellers, this year's Japanese market is more difficult than ever before.


In the context of a sluggish environment , cost saving is the way for sellers to survive . However, it is not easy to reduce costs in a compliant and reasonable manner.

As early as when the Japanese customs began to implement reverse calculation, some logistics companies launched the so-called "package reverse calculation" service, which seemed to reduce tariffs. However, behind it was the illegal behavior of not labeling the goods and passing them off as commercial items for customs clearance, which increased the operational risks of sellers.

As Japanese customs began to strictly investigate the import of fake commercial items this year, many logistics companies went bankrupt and many sellers suffered heavy losses. The main reason is the lack of complete last-mile resources.


Qianhai Ledi has always been focusing on "Japan's new generation of air and sea power dealers" and constantly strengthening every link of the Japan special line. After years of hard work, Ledi has its own customs clearance agency in Japan, self-operated Japanese overseas warehouses, and self-built local delivery teams . Through extensive layout, Ledi has a very high rate of independent control over each delivery link, which is obviously superior to ordinary logistics companies.

In response to the pain points of sellers, Qianhai LeDi launched the "labeling reverse calculation, 35% settlement" product, which truly helps sellers reduce international logistics costs on the basis of complying with Japanese tariff laws.


Labeling reverse calculation, 35% settlement

The compliance of LeDi products lies in: requiring sellers to label and actively participate in the reverse calculation required by the Japanese customs. It also adopts the form of regular e-commerce items and performs compliant reverse calculations in accordance with the reverse calculation requirements of the Japanese customs. Sellers only need to settle tariffs and other fees with Qianhai LeDi at 35% of the actual sales price of the goods.

Interested sellers welcome

Scan the QR code below for details↓

Cross-border small parcel, pick up in 2 days

In addition to the price advantage, Qianhai Ledi's timeliness and service are also remarkable, such as the cross-border parcel service for sellers on Japanese local platforms. Ledi has a large number of direct flights from Hong Kong/mainland China, and has fixed flights in Shenzhen, Guangzhou, Yiwu, Shanghai, Wenzhou, and Hangzhou , with chartered cabins and pallets . While ensuring timeliness, the price is 30% more favorable than the market! According to statistics, 90% of Qianhai Ledi's parcels can be picked up and signed for within 2-4 days !


Ledi Consolidation, Quality Service

Sellers with many products and large quantities can also learn about Qianhai Ledi's Japan consolidated shipping service. Compared with other peers' combined shipping by sea + air, all of Qianhai Ledi's consolidated shipping packages are air routes, which are faster! The most important point is that Qianhai Ledi does not despise any customer. Cross-border sellers who choose Ledi consolidated shipping can enjoy 1-on-1 exclusive customer service like other products !


Sellers in need are welcome to consult for details~ 18823418881 (same number on WeChat), or scan the QR code in the picture below to contact~


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