Bank of Japan Governor Kuroda speaking in the Diet
- Fed has been giving slightly more cautious comments
- Expect that's a reflection of US prices, China slow down
- BOJ policy does not have currency manipulation as its target
- must carefully watch impact of fed policy on markets, global economy
- will mull easing policy further if FX moves hurt economy, prices and threaten achievement of price goal
- various steps available if BOJ needs to ease more but must balance benefits, costs of steps
Check out the bolded comment … MOAR easing mulling! A negative for the yen.
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- central banks don't link policy to fx moves
- crucial to guide monetary policy with eye on economy, market moves including FX
- if BOJ were to ease further, it must take into account impact of such move on market function, financial intermediation