The three young Japanese women were everything retailers could hope for Friday as they paused at Ala Moana Center, checking a map of the mall layout. They had arrived a day earlier from Tokyo on what they happily called a shopping vacation. The rate, they said, would not deter their ambition to buy. They just wished they could buy more. As that case suggests, the weakening Japanese currency hasn't killed Japanese tourism, but it has reduced Hawai'i's affordability for an important segment of visitors.
Business people say the higher yen has a corresponding and worrisome effect on their operations.
The weak yen also has some influence on the number of Japanese visitors who come. Hawai'i's economy today relies less on Japanese tourism than a decade ago, when the collapse of Japan's so-called bubble economy had drastic consequences here. But Japanese tourists still represent about a third of Hawai'i's total, and their traditionally high-spending shopping habits make them a crucial part of sales strategies in the tourism industry. Exchange rates reflect the confidence of international currency traders in the direction of an economy, although governments can intervene in markets, investing reserves to prod rates in certain directions. Many economy watchers believe Japan has generally allowed its yen to weaken as a means of keeping its key export economy competitive.