The governor of the Bank of Japan (BOJ), Kazuo Ueda, said Friday that the financial position of the BOJ will not affect his decision on the short -term rate, which will focus on reaching the price objective.
Outstanding comments
The financial position of the Bank of Japan will not affect its decision on the short -term rate, which will focus on reaching the price objective.
Establishes the short -term policy rate to achieve the inflation objective.
We are aware of the aggressive behavior of companies in fixing prices and salaries that continue.
The reduction of the Council in inflation forecasts reflects the pressure on global growth due to the uncertainty of commercial policy, the slowdown in the rhythm of inflation by costs and the recent falls pronounced in the prices of crude oil.
Market reaction
When writing, the USD/JPY torque dropped 0.38% in the day to 143.68.
And in Japanese faqs
The Japanese Yen (JPY) is one of the most negotiated currencies in the world. Its value is determined in general by the march of the Japanese economy, but more specifically by the policy of the Bank of Japan, the differential between the yields of the Japanese and American bonds or the feeling of risk among the operators, among other factors.
One of the mandates of the Bank of Japan is the currency control, so its movements are key to the YEN. The BOJ has intervened directly in the currency markets sometimes, generally to lower the value of YEN, although it abstains often due to the political concerns of its main commercial partners. The current ultralaxy monetary policy of the BOJ, based on mass stimuli to the economy, has caused the depreciation of the Yen in front of its main monetary peers. This process has been more recently exacerbated due to a growing divergence of policies between the Bank of Japan and other main central banks, which have chosen to abruptly increase interest rates to fight against inflation levels of decades.
The position of the Bank of Japan to maintain an ultralaxa monetary policy has caused an increase in political divergence with other central banks, particularly with the US Federal Reserve. This favors the expansion of the differential between the American and Japanese bonds to 10 years, which favors the dollar against Yen.
The Japanese Yen is usually considered a safe shelter investment. This means that in times of tension in markets, investors are more likely to put their money in the Japanese currency due to their supposed reliability and stability. In turbulent times, the Yen is likely to be revalued in front of other currencies in which it is considered more risky to invest.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
