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Bank of Japan official sounds alert over banks' overseas exposure

"Under monetary policy divergence, US dollar funding premia in the currency swap market could easily spike higher," said Mr Nakaso.


DEPUTY governor of the Bank of Japan Hiroshi Nakaso warned on Friday that the cost of dollar funds could spike upwards if the direction of monetary policy between the Bank of Japan and the US Federal Reserve continues to diverge, posing possible threats to Japanese banks.


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