AsianFin -- Yoshimasa Hayashi, Japan’s top government spokesperson and a candidate for prime minister, said the Bank of Japan’s strategy to gradually raise interest rates aligns broadly with the government’s economic policy, in an interview with Reuters.
When asked whether U.S. Federal Reserve rate cuts could harm Japan’s export-driven economy by strengthening the yen against the dollar, Hayashi noted that policymakers in Tokyo are moving beyond such assumptions.
Japan’s historical aversion to a strong yen — long a concern for exporters and occasionally prompting government intervention — has lessened, he said. “Conversely, we’ve seen the yen weaken, which, combined with rising oil costs since Russia’s invasion of Ukraine, has led to cost-push rather than demand-driven inflation,” Hayashi added.
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