A country’s growth response to a depreciation of its currency generally depends on the structure of its economy; the varying responses of cost- and revenue-channels. So when a G20 nation warns Japan of impending ‘currency wars’, or when Bank of Japan Governor Kuroda says ‘the correction of excessive yen strength has had a positive effect on Japan’s economy’, they implicitly state Japan has a specific economic structure: probably that of manufacturing-driven 1980s Japan. But what if this time is different? I estimate a simple model of growth and investment since 1980 using VARs and a time-varying parameter technique, and present evidence of consistent stagnation in the ability of Japanese manufacturing investment to generate growth since the early 1990s. The evidence indicates in 2010s Japan both economic growth and productive non-manufacturing investment respond positively to yen appreciation, and that this relationship is strengthening over time. Impulse responses of the real exchange rate to manufacturing investment innovations indicate this sectoral stagnation may be due to the exporting of investment. Japanese economic growth appears now service-sector driven and to benefit from a higher yen.