Japan’s Finance Minister Shunichni Suzuki on Friday said that there is need for currency stability and he is vigilant of the yen’s slide against the U.S. dollar.
Domestic media and some market participants have warned of the potential demerits of a weak yen, which pushes up import prices and household’s cost of living at a time the economy is recovering from the COVID-19 pandemic, as reported by Reuters.
“I won’t comment on the currency market itself, but stability (of exchange-rate moves) is important above all,” Suzuki told reporters, signaling that Tokyo will escalate its warning if yen falls become too rapid or volatile.
“From that standpoint, we’ll closely watch currency market moves and their impact on the Japanese economy,” he said, when asked if the weakening yen was negative for the economy.
Suzuki’s remarks came as the dollar hovered near a five-year high at 116.355 yen hit on Tuesday, backed by expectations the U.S. Federal Reserve will embark on steady interest rate hikes even as the Bank of Japan keeps rates ultra-low.
Japanese policymakers have traditionally favored a weak yen, as it gives exporters a competitive advantage overseas.
