Tuesday saw the Japanese yen increase in value against the U.S. dollar after the economic minister of the Pacific Rim nation warned that abundant monetary easing might have unintended consequences, Bloomberg reports.
“A yen that is deliberately weakened might influence strong imports but also might impact individual households,” according toAkira Amari. The viewpoint is remarkable in that it directly defies the strong preference of new Prime Minister Shinzo Abe, who has emphasized the importance of spurring the globe’s third-largest economy with easing policies. The Tuesday performance of the yen marks the first climb for the yen in five days.
“If the yen excessively weakens, this would cause a spike in import prices,” the economic minister told reporters in Tokyo on Tuesday. “It would be a benefit for exports, but would have harmful effects on people’s livelihoods.”
Abe is poised to tap a new Bank of Japan chief and two deputy chiefs in March and April and he has repeatedly underscored the need to water down the currency.
Slippage for the U.S. dollar against the yen is poised to be ephemeral as investors will probably return soon to the dollar, Reuters reports.
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