Japan finance minister says major nations agree not to target FX levels

By Tetsushi Kajimoto

TOKYO (Reuters) – Japanese Finance Minister Taro Aso said on Friday that major economies have agreed to avoid targeting currency levels for the purpose of trade competitiveness.

Aso made the remark when asked about comments by U.S. President Donald Trump and Treasury Secretary Steven Mnuchin on the strength of the dollar.

Trump said on Thursday he ultimately wants the dollar to be strong, contradicting comments made by Mnuchin one day earlier, saying his comments had been misinterpreted.

“I won’t comment on every single remark of this kind by other countries’ leaders,” Aso told reporters after a cabinet meeting. “G7 and G20 have agreed to not target currency levels for the sake of international competitiveness such as trade. So we need to respond appropriately.”

Bank of Japan Governor Haruhiko Kuroda told reporters in Davos on Thursday there was a shared agreement among Group of Seven advanced economies that currency rates should move stably reflecting economic fundamentals, Kyodo news agency reported.

Aso welcomed Trump’s remark made in an interview in Davos that the United States would stay in the Trans-Pacific Partnership (TPP) if American negotiators were able to create a better agreement.

Since Trump pulled his country out of the TPP a year ago, Japan has worked with 10 other remaining members to create a high level free-trade zone in the region, Aso said.

“It’s no surprise that the United States takes that into account, as we were originally working together. The fact that the United States has such intention should be welcomed.”

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