Japan's Finance Minister, Shunichi Suzuki, delivered a series of statements on Tuesday, shedding light on the government's stance regarding foreign exchange rate movements and their impact on the country's economy. Here are the key points highlighted by Minister Suzuki:
Response to Exchange Rate Movements: Minister Suzuki affirmed that the Japanese government is prepared to respond to foreign exchange rate movements when deemed necessary.
Stability in Currency Movements: He emphasized the importance of currencies moving in a stable manner that reflects underlying economic fundamentals.
Influence on Long-Term Interest Rates: Suzuki acknowledged that long-term interest rates are influenced by a variety of factors, including economic conditions and policies.
Urgent Action on Exchange Rates: He stated that the government is ready to take necessary and appropriate steps concerning foreign exchange rate movements on an urgent basis.
Intervention Based on Fluctuations: The decision to intervene in currency markets would depend on the extent of fluctuations in exchange rates.
Inflation and Yen Weakness: Minister Suzuki noted that inflation in Japan is not only affected by domestic factors but also by the weakness of the yen. Additionally, he mentioned the situation in Ukraine as a contributing factor.
Non-Targeted Currency Interventions: He clarified that the Japanese government does not have a specific target for interventions in currency exchange rates.
Currency Intervention Comments: Suzuki refrained from commenting on the prospect of currency intervention.
Impact of Interest Rates on Households: The Finance Minister highlighted that closely monitoring long-term interest rates is crucial as it directly affects the lives of households.
Concerns About Yen Speculation: Minister Suzuki reiterated his concerns regarding speculative movements in the Japanese yen, especially as the currency has been hovering near its lowest levels against the US dollar in nearly 11 months.
These statements from Finance Minister Suzuki provide insights into Japan's stance on currency exchange rates and the government's willingness to respond to fluctuations when necessary. The government's focus on stability and its acknowledgment of the influence of various factors on long-term interest rates reflect its commitment to maintaining economic equilibrium in the face of currency challenges.