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Kuroda warns current yen strength risks harming Japan recovery
[TOKYO] Bank of Japan Governor Haruhiko Kuroda warned that the yen's biggest rally since Abenomics began risks harming the nation's economic recovery.
Speaking to reporters in Frankfurt Monday, Mr Kuroda also reiterated that BOJ policy makers won't hesitate to expand monetary stimulus in order to achieve their 2 per cent inflation target.
The central bank's board left settings unchanged at a meeting Thursday, spurring a nearly 5 per cent, two-day surge in the yen against the dollar.
"There is a risk that the yen's current appreciation brings an unwelcome impact on the economy," Mr Kuroda said on the sidelines of an annual gathering of finance chiefs from members of the Asian Development Bank, which he used to lead.
"We will be closely monitoring the impact of financial markets on the real economy and prices." The yen has climbed 13 per cent against the dollar this year, the best performance among its developed-market peers. It reached an 18-month high of 106.05 per greenback and was at 106.13 as of 8:32 am in Singapore.
Japan's economy is at risk of sliding into its second recession in two years after contracting in the final three months of 2015, while inflation remains far from the BOJ's target.
One gauge showed consumer prices retreated at an annual 0.3 per cent pace in March, the biggest decline since April 2013, the month that Mr Kuroda initiated his stimulus program.
Japanese markets are closed for holidays Tuesday, Wednesday and Thursday this week.