BOJ’s Kuroda: Yen depreciation has net positive impact on Japanese economy

  • Sensitivity of exports to exchange rates has declined significantly since GFC
  • Thus yen deprecation recently has become less likely to increase exports
  • BOJ monetary policy does not directly target exchange rate
  • To persistently continue with current powerful monetary easing through QQE with YCC
  • Full text

Nothing out of the ordinary from Kuroda. The BOJ is still preaching to the choir in trying to convince that they can achieve 2% inflation somehow. But na’ah, that ain’t gonna happen. Not this year, not the next. Perhaps not in the next few decades even.

There are bigger structural issues with Japan such as demographics and that is something that is impossible to change overnight. I’d like to be proven wrong but things have been going nowhere since the global financial crisis and the COVID-19 pandemic has just served to exacerbate the underlying problems in the economy.

BOJ Kuroda


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