In recent years, Japan's financial markets have seen dramatic changes. One of them is the explosive growth of currency trading and the increasing international role of the yen. Tokyo has become the third largest centre of foreign exchange trading worldwide, behind London and New York. The Japanese Foreign Exchange Market gives a comprehensive overview of this activity. It provides a comparative economic analysis of practices and risks as well as related policy issues. After a short introduction to the history of money in Japan, the work focuses on three areas: * General characteristics of the market such as market participants, trading strategies as well as accounting rules and practices and their influence on attitudes towards risks. In particular, the author searches for an explanation for the large currency losses Japanese firms experienced in recent years. * The nature of foreign exchange risks, the sources of exchange rate variability, the dangers of derivatives trading and the threats lurking in Japan's large-value interbank payment systems. * Policy issues, concentrating on prudential regulation and monetary policy co-opertion and studies the prospect for a yen zone in Pacific Asia. This work is the first non-Japanese language title to examine the prolific rise of Japan's foreign currency exchange market, its idiosyncracies, and its future role in the global economy. It is vital reading for economists and students of Japan-related subjects.