The Bank of Japan (BoJ) captured the attention of the foreign exchange world last week when it started to live up to the expectations of the market. After much anticipation, and lots of preceding rhetoric, Governor Haruhiko Kuroda announced the BoJ’s plan to double its bond buying efforts to reach the 2% inflation target in the allotted two-year window. It was his comments on Prime Minister Shinzo Abe’s inflation goals while still at the Asian Development Bank that might have won him the top job at the Japanese central bank. Earlier this week, the program kicked into gear and the JPY lost 4% versus the USD and 5% versus the GBP. The main beneficiaries have been Japan’s exporters and holders of Japanese stocks with the Nikkei Index reaching new highs on the value of the yen.
The decision has not been without its critics and some, such as George Soros, cautioned that the fall in the yen could be “an avalanche” that the BoJ could not stop if the Japanese people start to sell the currency. China and South Korea remain critical of the move, branding it a currency war before the Group of Twenty meeting last February. This week, the negative criticism persisted, but the words used were “monetary blackmail” instead of “currency war”. Those ugly words have not been uttered since the Group of Seven made it clear that as long as Japan’s monetary easing means are used for domestic aims, it does not imply unfair currency manipulation.
- Asian Currencies Set for Biggest Gains Since September
- BOJ’s QE Won’t Unleash Hot Money, Unlike Fed
- Corruption Clean Up push China Growth Higher
- Rate Decision Leads to South Korean Bonds Slide
- Strong AUD/USD continue to hurt local businesses
- Stocks in Asia continue to trade higher
- Fitch Downgrades Chinese Local Debt
- China Exports Miss Forecasts With Data Quality Suspected
- Asian Economies Still Susceptible to Europe Fallout
- China’s March Consumer Prices Rise 2.1% From Year Earlier
- Skepticism abound on improving Chinese Export Data
- Sliding Yen Drives Japan Gains From Trade to Consumers
- IMF’s Lagarde: BOJ’s policy good for promoting global growth
- Nikkei Up Nearly 3% but Yen Slumps
- BOJ Moves Leads to Weakest Yen Since June 2009
- China President Xi not upbeat about global recovery
- Chinese Local Government Debt Soaring
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