As for foreign exchange rates, the real effective exchange rate is at the lowest level since the 1985 Plaza Accord, and the upward trend in land prices in major cities has become increasingly distinct as seen in the fact that commercial land prices in Tokyo and Osaka in March's Land Price Publication showed a double-digit increase from the previous year.
It has had a positive impact on business investment since 2013. Foreign demand has had a negative impact on real business investment over that same period. These results therefore suggest foreign demand is the main factor still weighing on investment growth. 4  However, this probably doesn’t reveal the whole picture. That’s because macro-data hide important heterogeneity across firms.