G7 may short-change Europe again -- up to Japan - by Brian Love
The Europeans go into G7 talks in Essen next weekend looking to put a stop to the yen's slide but could leave the German industrial city with even less than the last time they tried, in Singapore in September. The ball is now in Japan's court, and Tokyo has good reason to do something about the yen, though it has as much freedom as it needs not to do so at the talks on Friday and Saturday in Essen, economists and currency market strategists say.
The yen slide versus the euro in the last year alone is four times as big as the decline against the dollar, making the loss of European price-competitiveness in world markets potentially far bigger than for the United States, for now in any case. Europe has a valid case and the yen's slide will become more of an issue if it hurts the United States, but Europe has done a poor job of providing evidence to justify collective action now by the G7, Jen and many others say.
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