17 Feb 2015
Positive effects of weak yen seen bigger than negatives for now – BTMU
FXStreet (Barcelona) - Lee Hardman, Currency Analyst at Bank of Tokyo-Mitsubishi UFJ, shares the comments that Japanese policy makers prefer a gradual rather than a sharp weakening of the Yen.
Key Quotes
“In an interview with reporters overnight Japanese Economy Minister Amari stated that the positive effects of a weak yen are currently bigger than the negatives. He added that an excessively weak yen would diverge from fundamentals but couldn’t say what line represents an excessive level of yen weakness.”
“An excessively weak or strong yen, and excessively rapid moves in foreign exchange are not viewed as good for the Japanese economy.”
“The comments suggest that the Japanese authorities are not yet concerned over the scale of yen weakness.”
“In a recent report from Bloomberg, it reported that the BoJ views further monetary easing as counterproductive for now with the risk that further yen weakness could undermine confidence in the economy.”
“Taking the two views together it suggests that the Japanese policymakers would be uncomfortable if the yen was to weaken sharply again, although are not opposed to a further gradual weakening of the yen.”
Key Quotes
“In an interview with reporters overnight Japanese Economy Minister Amari stated that the positive effects of a weak yen are currently bigger than the negatives. He added that an excessively weak yen would diverge from fundamentals but couldn’t say what line represents an excessive level of yen weakness.”
“An excessively weak or strong yen, and excessively rapid moves in foreign exchange are not viewed as good for the Japanese economy.”
“The comments suggest that the Japanese authorities are not yet concerned over the scale of yen weakness.”
“In a recent report from Bloomberg, it reported that the BoJ views further monetary easing as counterproductive for now with the risk that further yen weakness could undermine confidence in the economy.”
“Taking the two views together it suggests that the Japanese policymakers would be uncomfortable if the yen was to weaken sharply again, although are not opposed to a further gradual weakening of the yen.”