xi's moments
Home | Asia Pacific

Japan PM watches for stable exchange rate after yen hit new low

By Jiang Xueqing in Tokyo | chinadaily.com.cn | Updated: 2024-03-29 10:10

Japan's Prime Minister Fumio Kishida. [Photo/Agencies]

The Japanese government will continue to closely monitor foreign exchange moves with a high level of vigilance, and will be prepared to take appropriate action against excessive moves, Japan's Prime Minister Fumio Kishida said on Thursday.

"It is important for the exchange rate to reflect fundamentals and to move in a stable manner. Excessive volatility is undesirable," Kishida said at a news conference in Tokyo.

The Japanese yen briefly dropped to 151.97 against the US dollar on Wednesday, marking its lowest point since July 1990.

Despite the Bank of Japan's (BOJ) recent decision to raise its benchmark interest rate for the first time in 17 years, the yen has continued to slide against the dollar since the central bank of Japan's monetary policy announcement on March 19. This persistent weakening comes as the BOJ emphasizes its intention to maintain a dovish stance for the foreseeable future.

BOJ policy board member Naoki Tamura reiterated on Wednesday that the accommodative financial situation will continue and affirmed that the BOJ will slowly but steadily normalize its monetary policy.

Kishida revealed insights from his recent meeting with the BOJ governor, where they discussed the central bank's transition into a new phase following over a decade of unprecedented monetary easing policies.

In addition, highlighting positive economic indicators, the BOJ expressed its belief in the necessity of maintaining an accommodating financial environment.

"While transitioning to a new phase from the prolonged unconventional monetary easing policy, maintaining an accommodative financial environment is deemed appropriate to further solidify positive economic trends," Kishida said.

Noting that the path to overcoming deflation in Japan is still near the halfway point, he emphasized the importance of close coordination between the BOJ and the Japanese government.

"We are currently in a stage where we aim to achieve a complete departure from deflation and transition to a new growth-oriented economy. Therefore, the government is eager to collaborate on various policies, and we hope that the BOJ will respond closely in tandem," he said.

Japan's parliament on Thursday enacted a budget of 112.57 trillion yen ($746 billion) for fiscal year 2024, which starts in April. This budget stands as the second-largest in Japanese history and incorporates a record-breaking allocation of 7.95 trillion yen for defense expenditure.

Global Edition
Copyright 1995 - . All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
License for publishing multimedia online 0108263

Registration Number: 130349