Ex-BOJ’s Momma: Weaker yen likely to prompt the central bank message shift

Kazuo Momma, a former top official in charge of monetary policy at the BOJ said in a Bloomberg interview, should the yen depreciate further, it may prompt a shift in the central bank’s guidance, as it would be seen as negative for the Japanese economy.  

Key quotes

“The yen has already moved a lot compared with last year.”

“So, a further weakening means volatility has generally been high. That isn’t at all desirable.”

‘Absolutely no chance’ of normalization moves at moment.”

Market reaction

USD/JPY is struggling near-daily lows of 118.28 amid falling Treasury yields and anxiety ahead of the Fed decision. The spot is trading modestly flat on the day.