Why Japan's Currency Is So Volatile Lately

There were plenty of reasons for the global market selloff on Aug. 5, including premature worries of a US slowdown and fears of an artificial intelligence bubble. But one key factor was the unwinding of a popular yen-centered carry trade. The trouble began when the yen's value started rising after the Bank of Japan hiked interest rates for a second time this year. Now, as the dust settles, investors and Japanese business owners alike are questioning the yen’s role in the global economy.