Japan’s New Finance Minister Stresses FX Stability Is Vital
Japan’s New Finance Minister Stresses FX Stability Is Vital
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Japan’s new finance minister Shunichi Suzuki, in his first remarks on currencies since taking the post this week, provided strong assurance to investors that he’ll pursue continuity in the nation’s currency policy.
“There’s no doubt that stability in currencies is important for the Japanese economy,” Suzuki said in a group interview with reporters Thursday. “I will be certain to keep monitoring movements in foreign exchange markets closely.”
Suzuki’s boss, new Prime Minister Fumio Kishida, came into power this week dangling a ‘new style of Japanese capitalism’ ahead of elections later this month. But comments so far from the country’s finance chief suggest that the administration won’t stray far from key policies that have been in place for years.
Yoshihide Suga, who was replaced as premier this week, is known for having kept a watchful eye on the currency markets that are so important to Japan’s exporters. Suga had said that foreign exchange rates were the most important indicator in the economy.
In a brief interview with reporters, Suzuki played it safe by offering the standard set of remarks on currencies, with some added emphasis that seemed designed to reassure markets.
On debt, he said that Japan must keep its goal of balancing the budget by the year ending March 2026 and that showing fiscal discipline was needed to maintain market trust in the country’s bonds.
“We have to keep waving the flag,” he said to emphasize the need to appear steadfast.
The government doesn’t actually see Japan balancing its budget anytime this decade, according to its own base-case forecast.
Asked if he supports quarterly reporting by publicly traded firms, which some have blamed for encouraging businesses to eschew long-term thinking, he said that the issue needs careful consideration.
Kishida has said that a focus on the short-term has led corporate Japan to prioritize shareholders over workers and more sustainable business practices.
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