BoJ Governor Shirakawa Defends CB Policy

Bank of Japan Governor Masaaki Shirakawa on Monday defended the central bank’s monetary policy, saying it has helped stem the yen’s rise and that more efforts by the government are important in combating deflation.

Shirakawa’s remarks came at a time when debate over the BOJ’s handling of Japan’s flagging economy is heating up ahead of the Dec. 16 general election, with Shinzo Abe, leader of the opposition Liberal Democratic Party, calling for more aggressive monetary easing.

But the governor rejected Abe’s view that the bank’s monetary easing is not enough, in his speech in Nagoya, where he met local business leaders, noting that the monetary base, the amount of money supplied by a central bank, has been “more or less the same” as in Europe and the United States.

The BOJ’s monetary easing including financial asset purchases, coupled with the government’s yen-selling intervention, “has fended off the yen’s appreciation to some extent,” Shirakawa said.

He also stressed the need for efforts on the government’s part to boost the economy, saying, “It is really important for the government — through measures such as decisive deregulation — to raise the attractiveness of domestic investment and lay the foundations that encourage firms to be adventurous.”

via Mainichi

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza