Kazuo Ueda releases doves again: Bank of Japan has enough time to consider the next policy measures

Zhitong
2024.10.24 23:18
portai
I'm PortAI, I can summarize articles.

Bank of Japan Governor Katsuo Ueda said that the central bank has enough time to consider the next policy steps, indicating that even if the yen falls to a near three-month low, there will be no interest rate hike next week. He emphasized the need to pay attention to the impact of the weak yen and the U.S. economy on Japanese inflation. The market generally expects no policy adjustments this month, with investors focusing on the policy decision on October 31 and future rate hike timing. The yen to dollar exchange rate recently fell to 151.7, touching a low of 153.19 on Wednesday

According to the Wisdom Financial APP, Haruhiko Kuroda, Governor of the Bank of Japan, stated that the Bank of Japan has time to consider its next policy measures, indicating that even if the yen falls to a near three-month low, the central bank will not raise interest rates next week.

After the conclusion of the G20 finance ministers and central bank governors meeting in Washington, Kuroda said in an interview, "I believe we have enough time" to make policy decisions.

Kuroda said, "We need to take a comprehensive view and carefully study the impact of the weak yen and the U.S. economic view on Japanese inflation, which may be related to the U.S. presidential election."

The governor expressed high vigilance towards risks from the U.S. economy, despite acknowledging that optimism seems to be spreading. On Wednesday, Kuroda expressed concerns about the U.S. economy during the International Monetary Fund and World Bank annual meetings.

The Bank of Japan will make a policy decision on October 31, when investors will closely watch for clues on the timing of another rate hike. Kuroda's remarks may reinforce market expectations, as almost all Bank of Japan watchers have already expected no policy adjustments this month.

Yen Depreciation

Furthermore, the market believes that guidance after the upcoming meeting is crucial, as a recent survey shows that most economists expect the next action to take place in December or January next year.

Earlier this week, the yen fell to its lowest level against the U.S. dollar since July 31. Investors are closely watching whether the depreciation of the yen will amplify the upward inflation risks, thereby advancing the timing of rate hikes.

At the same press conference, Japanese Finance Minister Taro Aso reiterated his warning about the yen. He stated that he told his G20 counterparts that the high volatility in the foreign exchange market deserves close attention.

As of the time of writing, the exchange rate of the yen against the U.S. dollar is hovering around 151.7 yen to 1 USD, and on Wednesday, this rate briefly touched a low of 153.19

Source: Zhitong The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.