BOJ Chief Says Rapid Yen Weakening Bad For Economy
Haruhiko Kuroda, Governor of the Bank of Japan, reiterated his warning on Friday, June 17, 2022, that the yen's recent rapid depreciation is "negative" for the Japanese economy, adding that currency movements should be stable and reflect economic and financial fundamentals, Mainichi Japan reported.
Photo Insert: Despite rising interest rates elsewhere, the BOJ chief reaffirmed his commitment to keeping the benchmark 10-year Japanese government bond yield at 0.25 percent.
Following the BOJ's regular two-day meeting, Kuroda told a press conference that monetary easing is required to achieve the BOJ's 2% inflation target in a stable and sustainable manner.
Despite rising interest rates elsewhere, the BOJ chief reaffirmed his commitment to keeping the benchmark 10-year Japanese government bond yield at 0.25 percent.
The central bank has no plans to allow the yield to rise above that level by expanding the trading band, he said at a press conference, dismissing market speculation that such a move was possible.
"The recent rapid weakening of the yen is raising uncertainty over the outlook and making it hard for companies to draw up business plans so it is negative and undesirable for the economy," Kuroda said.
"We will have to closely watch developments in financial and currency markets and their impact on the economy and prices," he said, adding that the BOJ does not guide policy to target foreign exchange rates.
The yen had fallen sharply against the US dollar following the BOJ's no-change decision earlier in the day. "Policy tightening is not appropriate at this point," the governor argued.