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BOJ’s Kuroda vows to patiently continue powerful monetary easing

BOJ's Kuroda vows to patiently continue powerful monetary easing
© Reuters. FILE PHOTO: Bank of Japan Governor Haruhiko Kuroda speaks at a news conference in Tokyo, Japan, December 19, 2019. REUTERS/Kim Kyung-Hoon

By Tetsushi Kajimoto

TOKYO (Reuters) -Bank of Japan Governor Haruhiko Kuroda pledged on Monday to patiently stick to powerful monetary easing to help the economy recover from the COVID-19-induced doldrums, shrugging off any suggestion about departure from its stimulus policy.

Kuroda told parliament the yen was regaining stability from recent rapid weakening that was “undesirable,” adding that the situation was improving currently, with the dollar strength easing to around 127 yen.

The Japanese currency weakened to two-decade lows beyond 131 to the dollar earlier this month, stoking concerns about the rising cost of living.

Some critics blamed it on the BOJ’s monetary easing at a time when the U.S. Federal Reserve is tightening policy that has led the dollar to strengthen.

When pressed by an opposition lawmaker to explain any correlation between the BOJ’s monetary easing and the yen weakening, Kuroda said:

“I don’t think the BOJ’s monetary policy was the factor behind a rapid yen weakening.

“The recent yen weakening may have been driven by an abnormal situation where oil prices topped $130 per barrel.”

Japan’s core consumer prices, excluding fresh food but including oil products, rose 2.1% in the year to April, the fastest rate in seven years.

Kuroda said a quarter of the gain was led by the weak yen while the remainder was caused by rises in the dollar-denominated global commodity prices.

Source: Investing.com

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