TOKYO, July 24, 2026, 22:16 JST
- Toyota ended the session at 2,897 yen, falling 1.8% on Friday and slipping 0.09% over the week.
- An initial scenario using only the dollar suggests annual profit backing of 698 billion yen.
- The Federal Reserve and Bank of Japan are set to announce decisions before Toyota releases results on August 4.
If the yen remains at Friday’s low on average throughout the year, Toyota Motor (TYO:7203) would potentially see around 698 billion yen added to operating profit. That would narrowly offset the estimated 670 billion yen impact from the Middle East. This figure is an early estimate and not official company guidance.
Toyota stock ended Friday down 1.8% at 2,897 yen, little changed compared to its July 17 finish. Trading in Tokyo ended at 15:30.
The yen fell to 163.96 against the dollar, marking its lowest level since November 1986. Toyota’s annual forecast is based on an exchange rate of 150 yen per dollar. This leaves a difference of 13.96 yen, or 9.3%.
According to a Jiji Press survey, Toyota’s operating profit rises by 50 billion yen for every one-yen drop in the currency. This sensitivity, when applied to the difference, results in an estimated 698 billion yen. The calculation reflects only the impact of the dollar.
| Asset | Friday close | Friday move | July 17–24 | FY dollar assumption | Annual sensitivity |
|---|---|---|---|---|---|
| Toyota Motor (TYO:7203) | ¥2,897.0 | -1.80% | -0.09% | ¥150/$ | ¥50bn per ¥1 |
| Honda Motor (TYO:7267) | ¥1,536.0 | -1.95% | +0.03% | ¥145/$ | ¥10bn per ¥1 |
| Nissan Motor (TYO:7201) | ¥322.2 | -3.04% | -2.16% | ¥150/$ | ¥12bn per ¥1 |
| Nikkei 225 | 64,611.15 | -2.73% | +0.70% | — | — |
Weekly stock movements reflect the closing prices on July 17 and July 24. Annual Jiji Press estimates provide currency sensitivities.
Toyota is five times more sensitive to currency fluctuations compared to Honda and over four times more sensitive than Nissan. Its weekly return outperformed the combined average of the two rivals by 0.98 percentage point, but remained 0.79 point behind the Nikkei.
Toyota is still trading 27.6% under its February 9 high of 4,000 yen. The drop shows scant indication that investors see currency as a straightforward benefit.
Toyota projects its operating income for fiscal 2027 at 3 trillion yen, a decrease of 20.3%. The operating margin is expected to decline to 5.9% from 7.4%. The outlook is based on exchange rates of 150 yen to the dollar and 180 to the euro.
The company reports it is unable to completely counterbalance the effects from the Middle East. Toyota executive Takanori Azuma cited increased costs such as “fuel costs, transportation expenses” and assembly components. Brent crude hovered around $97.69 on Friday. トヨタ自動車株式会社 公式企業サイト
Weaker demand presents an additional challenge. Toyota’s global sales in May decreased by 7.2% compared with the prior year. Deliveries in China slumped 31.7%, and in the Middle East, sales were down 38.6%.
The currency’s support remains weak. Finance Minister Satsuki Katayama stated that Japan may implement “decisive action without hesitation.” Such intervention has the potential to boost the yen, at least at first. Reuters
The Federal Reserve is scheduled to convene on July 28–29, with markets assigning about a 33% probability to a rate hike. The BOJ will gather on July 30–31 and is anticipated to keep rates at 1%. Outcomes from both meetings could affect Toyota’s exchange-rate gap.
Toyota is scheduled to announce first-quarter earnings on August 4. Market participants are focused on its 150-yen exchange rate forecast and 3 trillion-yen profit goal. Any changes to currency assumptions will indicate the remaining financial buffer.
Risks: The yen may strengthen rapidly if there is a currency intervention or if the BOJ adopts a hawkish stance. Increases in oil, material, and logistics costs could offset the advantage. Low demand from China and the Middle East continues to pose the primary risk to volumes.
