Japan blamed ‘speculative markets’ for yen decline

Japan blamed ‘speculative markets’ for yen decline

“We are deeply concerned about recent rapid and one-sided market moves, fueled in part by speculative trading.Suzuki said at the news conference. “There is no change in our position to be prepared to respond as needed” to such moves, he added.

Japan is likely to spend a record 3.6 trillion yen ($25 billion) last Thursday in its first dollar-selling, yen-buying intervention in 24 years to stem a sharply weakening currency, according to estimates of Tokyo money market brokerage firms.

BoJ Governor Haruhiko Kuroda said on Monday that the central bank is likely to maintain its ultra-loose monetary policy for now, but added that its commitment to keep interest rates at “current or lower levels” was not what necessarily remain unchanged for years.

At last week’s press conference, Kuroda said the BoJ was unlikely to change its rate guidance for “two to three years” but backed down on Monday.

“It won’t be for so long, but in two or three years,” Kuroda told a briefing in Osaka, western Japan, noting that guidance could change depending on how long it takes for the economy to fully emerge from the effects of the COVID-19 pandemic.

However, Kuroda warned of growing risks for the Japanese economy and underscored his decision to keep rates ultra-low, despite analysts saying it is helping accelerate the Japanese currency’s decline.

“If the risks to the economy materialize, we will obviously take various monetary easing measures without hesitation, as needed,” he said at a meeting with business executives in Osaka, western Japan.

Source: Ambito

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