Forex News – Yen weakens as BOJ reaffirms monetary policy to reflate economy
August 28, 2013 1:19 pm
The dollar was given an opportunity to rebound against the yen after the Japanese currency fell on comments by the Bank of Japan Deputy Governor Kikuo Iwata on monetary policy.
Iwata spoke to business leaders at a meeting in Kyoto on Wednesday, reiterating that the Bank of Japan aims to achieve a 2 percent inflation target within two years and also will continue with quantitative easing until this target is met.
“Our goal is to achieve 2 percent inflation as soon as possible with a two-year timeline as a reference point,” Iwata said.
“We are also focused on how we achieve 2 percent inflation. What we want to see is higher wages and an increase in capital expenditure contributing to our price goal, “ Iwata added.
In April of this year, the Bank of Japan announced it will implement bold monetary stimulus measures in an attempt to boost the sluggish Japanese economy and fight deflation.
These measures include doubling the supply of money in two years by boosting purchases of government bonds.
Such measures tend to weaken the yen which has declined considerably since April.
The next BOJ policy meeting is on September 4-5. At its previous meeting, the BOJ kept policy on hold and left its economic assessment unchanged as it awaits more clues on the strength of capital expenditure and employees’ wages.
The dollar was given an opportunity to rebound against the yen after the Japanese currency fell on comments by the Bank of Japan Deputy Governor Kikuo Iwata on monetary policy.
Iwata spoke to business leaders at a meeting in Kyoto on Wednesday, reiterating that the Bank of Japan aims to achieve a 2 percent inflation target within two years and also will continue with quantitative easing until this target is met.
“Our goal is to achieve 2 percent inflation as soon as possible with a two-year timeline as a reference point,” Iwata said.
“We are also focused on how we achieve 2 percent inflation. What we want to see is higher wages and an increase in capital expenditure contributing to our price goal, “ Iwata added.
In April of this year, the Bank of Japan announced it will implement bold monetary stimulus measures in an attempt to boost the sluggish Japanese economy and fight deflation.
These measures include doubling the supply of money in two years by boosting purchases of government bonds.
Such measures tend to weaken the yen which has declined considerably since April.
The next BOJ policy meeting is on September 4-5. At its previous meeting, the BOJ kept policy on hold and left its economic assessment unchanged as it awaits more clues on the strength of capital expenditure and employees’ wages.
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