Since the Russia Ukraine war started, the Japanese Yen has dropped 10%, outpacing even the Russian ruble, the Turkish lira, and the Argentinian peso. The reason why the war is the major culprit behind the fall of the Japanese Yen had been explained here.

Besides the war, the currency rout is being fueled by the Bank of Japan's (BOJ) success in capping 10-year Japanese yields at 0.25%. BOJ has committed to keeping its 10 years bond yield at 0.25% at all forces, including printing an unlimited amount of money just to support the bond price.

What are the implications?

A weak Yen is good for Japanese exporters, which means it could be a threat to companies producing the stuff where Japanese are good at making, such as automotive, auto parts, chemicals, and machinery.

In order to compete with Japan, most of the Asia countries that rely on international trade could also devalue their currency in order to maintain their export competitiveness. When foreign investors are expecting a downtrend in the Asian countries' currency, their money will leave this region, the situation is worsening as the US is raising its interest rate.

In short, watch the USD/JPY rate closely. Once it reaches 135, something bad could happen.