The chairman of the Japan Chamber of Commerce and Industry, Nobuo Yamaguchi, yesterday recommended “yen-buying intervention by the Ministry of Finance” to stop the yen’s slide against virtually all other currencies.
Japanese corporations are not normally a hotbed of activism in terms of boosting the yen.
While a lot of people are unhappy with the Bank of Japan’s inability to take the initiative on monetary policy, the spending-addicted Japanese political establishment doesn’t want to hear anything about increasing interest rates, which will cause severe short- (and maybe medium-) term pain for the Japanese economy.
The Japanese parliament extended its current session by a week, which thus pushes back Upper House elections by a week as well. Which, coincidentally, is the last day of the Bank of Japan’s July deliberations, and since Fukui has promised no interest rate hikes until after the July elections, that pushes back interest rate hikes until August.
(Thanks to the Japan Economy News blog for the pointer.)
Posted: June 21st, 2007 under Asia, Currency, Foreign Exchange, General.
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