Bank of Japan Governor Kuroda comments earlier sent USD/JPY lower
Catching up on remarks from Kuroda earlier in the session. His remarks on ‘excessively weak yen’ are intended to lend some support to the currency – Japanese authorities do not want yen falling too rapidly.
- desirable for FX to move stably reflecting econ fundamentals
- sharp yen moves
could have negative impacts on economy - has not changed view
that weak yen is positive for economy as a whole - weak yen’s impact is
uneven depending on sectors, corporate sizes - recent yen weakening
has been quite sharp - recent sharp yen
weakening could have impact on corporate profit plans - excessive weak yen
or yen’s rapid weakening can have more negative impact, but weak yen
is basically positive overall
And, more:
- Japan’s rising prices due to energy prices
- appropriate to
continue monetary easing - as Japan’s energy
mostly relies on imports, global commodity rally has only negative
impact unlike a weak yen - too early to debate
exit from stimulus policy
You can see the impact of Kuroda’s remarks in the chart, below. As I said above the intent is to slow the fall of yen. At this stage the intent is not to reverse it.
