BOJ chief denies currency manipulation

The requested article has expired, and is no longer available. Any related articles, and user comments are shown below.

  • 0

    sfjp330

    Although Japan's accused currency manipulation is to boost trade balances is a violation of the Articles of Agreement of the IMF. There is currently no procedure to punish or curtail it. The best forum for sanctions against currency manipulators is the WTO, operating with the IMF. Countries affected by Japan's accused currency manipulation would be authorized to impose tariffs on imports from Japan. In order to get Japan to agree to this change in international rules, the U.S., China and Europe have to play tough.

  • 0

    semperfi

    China and Europe have to play tough.

    Right now - - - -Europe can't work its way out of a wet paper bag fiscally --------------------and China is the BIGGEST CURRENCY MANIPULATOR, keeping its currency value deliberately down................................................

  • 4

    tkoind2

    Just admit it already. Everyone sees it, everyone knows it is happening and it just looks silly to lie about it. Own up to it and move on.

  • 0

    paulinusa

    Easing is a legitimate tool to benefit the economy and as far as I know they haven't intervened in the currency markets. The only thing they are guilty of is "jawboning", a common practice. And for the record, most of the howls of protest have come fro Europe, NOT the US.

  • 0

    sfjp330

    semperfi Feb. 15, 2013 - 09:02AM JST China is the BIGGEST CURRENCY MANIPULATOR, keeping its currency value deliberately down................................................

    If the Yuan is adjusted another 25 percent against the dollar to about 4.50 yuan rate, and China withdraws $1.2 trillion from the current U.S. investment, the U.S. has to pay China additonal $300 billion in currency exchange alone. Sounds good to you? Is this what you want? U.S. does not want sudden change in Yuan exchange rate.

  • 0

    timtak

    This news is probably why gold and stocks are both down today.

  • 1

    Yukisha

    In my investment view,most important thing for the government is to continue announcing their sustainable economic growth strategy. Abenomics seem to be very efficient for Japanese stock market and currency devaluation but it might be short term effect. So far, the foreign institutional investors has thought highly of his confidence. But, on the other hand,we are suspicious if the Abenomics could have sustainable effect on the Japanese real economic growth. Recently Nekkei 225 movement has been same course,fluctuated.The reason might be the government couldn't show their long term strategy of Japanese economic growth. Some people are saying that Mr.Abe just want to win next general election and he doesn't think of Japanese long term economic growth. The foreign institutional investors have already been interested in the next Japanese government view,how do we solve the Japanese fiscal cliff problem etc... The individual investors survey has been much brighter for these 3 months.But it's too early to feel at easy.

  • 1

    paulinusa

    Dog: Japan has intervened in the past and the results were minimal (they were ridiculed for their efforts on this site). And where is the US criticism now, not two,three years ago?

  • 2

    Frungy

    The joke is that devaluing the currency is pointless. If I announce that gold is worth 10% less in Japan then what will happen? International gold investors will rush to Japan, buy gold like mad until the value rises again, then sell it at a profit in another market. The yen is just another commodity like gold. Devaluing it domestically does nothing since it just raises demand internationally and so resets the value to market value.

    Are the Japanese economists truly incapable of understanding that there is a global currency market and that it is self-correcting?

  • 0

    timtak

    Frungy. Interesting point.

    Are the Japanese economists truly incapable of understanding that there is a global currency market and that it is self-correcting?

    Does this mean that they can just print away their debt and nothing will happen to the value of their currency?

  • 0

    herefornow

    when Abe and his Liberal Democratic Party campaigned in national elections on a platform of big spending and aggressive monetary easing

    with the yen’s fall an unintended consequence

    LOL. They campaigned on "aggressive monetary easing", but the fall in the yen was "an unintended consequence"? Sorry, but that fails the smell test, in a big way. Even an Econ 101 student could predict that the law of supply and demand would rule, and flooding the market with yen would drop the price. Never ceases to amaze me that Japanese foreign-policy folks think that just because you can fool the Japanese citizens with jibberish, that you can do the same with foreign governments.

  • 3

    SamuraiBlue

    sfjp330

    If the Yuan is adjusted another 25 percent against the dollar to about 4.50 yuan rate, and China withdraws $1.2 trillion from the current U.S. investment, the U.S. has to pay China additonal $300 billion in currency exchange alone.

    You make no sense since all investment in the US is based on dollars and paid in US dollars so whether the yuan goes up or not has no relationship with the other. The Yuan will go up considerably if you try to cash in the dollar into Yuan as well.

  • 0

    nigelboy

    Herefornow

    It's evident that you failed to read the actual press conference of Shirakawa but succumbed to the typical Western media's (AFP) history of injecting statements that isn't there but this is typical of many of posters here.

    What Shirakawa said in regards to "currency intervention".

    "もちろん、金融市場がグローバル化していますから、それぞれの国における金融政策が、為替相場にも相応の影響を与える ことは事実ですが、為替誘導、為替相場に影響を与えることを目的としているのではありません。"

    "Of course, due to the globalization within the financial markets, each country's monetary policy will have impact on the foreign currency markets. However, the goal was not currency manipulation or to have an effect on the currency market."

    http://www.boj.or.jp/announcements/press/kaiken_2013/kk1302c.pdf

    Like you said, Econ 101.

  • 0

    nigelboy

    Although Japan's accused currency manipulation is to boost trade balances is a violation of the Articles of Agreement of the IMF. There is currently no procedure to punish or curtail it. The best forum for sanctions against currency manipulators is the WTO, operating with the IMF. Countries affected by Japan's accused currency manipulation would be authorized to impose tariffs on imports from Japan. In order to get Japan to agree to this change in international rules, the U.S., China and Europe have to play tough.

    ???? Your first sentence doesn't make sense. Are you saying that "accusation" by other country is a "violation"? In any case, considering the fact that IMF publicly stated that Yen was "overvalued", the recent spike which is dictated by the "market" is a welcoming sign for IMF.

    As Paulinusa had alluded to, a direct currency intervention by central banks have very little effect on the currency market which is dominated by hedge fund and large global banks.

  • 0

    sfjp330

    SamuraiBlueFeb. 15, 2013 - 02:46PM JST You make no sense since all investment in the US is based on dollars and paid in US dollars so whether the yuan goes up or not has no relationship with the other. The Yuan will go up considerably if you try to cash in the dollar into Yuan as well.

    On the currency exchange investors, in 2007, the value of yuan was 8.27 to the dollar, and if CHINA cashed in $1.0 billion in U.S. treasury AND bought 100% Chinese yuan at this rate, and hold it in Chinese bank for less than two years, and the value was adjusted to 6.80 yuan per dollar in 2008-09, China could've reinvested the entire amount in the U.S. treasury again, and the value would've been $1.2 billion, a gain of $200 million.

  • 0

    sfjp330

    correction, the value would've been $1.2 trillion, a gain of $200 billion.

  • 2

    zichi

    George Soros, the hedge fund billionaire in the last 3 months made $1.2bn betting against the yen.

  • -1

    sfjp330

    Japan is a member of IMF that requires the government to avoid manipulating exchange rates to prevent unfair competitive advantage over other members. Other countries could argue that Japan's currency manipulation represents an illegal, market-wide export subsidy. These countries could could file a complaint, alleging that Japan has undermined the spirit of the WTO agreement through a loophole.

  • 0

    nigelboy

    Japan is a member of IMF that requires the government to avoid manipulating exchange rates to prevent unfair competitive advantage over other members.

    So you basically ignored IMF Lagarde's comments about the "over valued" yen last year and just recently IMF's Deputy Managing Director Lipton's comment in regards to 2% inflation target as being appropriate.

    Other countries could very well "argue" but considering that not a single yen has been implemented by BOJ nor the budget submitted by the current cabinet, the recent decline in yen is simply market driven and nothing more.

  • -1

    sfjp330

    Nigeboy... Japan has history of manipulating yen and this is repeating again. Recently as 2008, when yen was at 103, the Big Three auto manufacturer claim that the yen is undervalued by 15% to 25% because of massive intervention by the Bank of Japan. The currency manipulation by Japan is a serious unfair trade practice impacting U.S. auto manufacturers that provides an average subsidy of thousands of dollars for each and every car it exports to the U.S.

    At the time, The Big Three demand that the U.S. and other governments lean on Japan to stop all direct and indirect currency interventions. They call on the U.S. Treasury Department to declare Japan a “currency manipulator” and on Congress to “vigorously monitor implementation of the currency provisions of the 1988 Omnibus Trade Act”, provisions that can ultimately result in trade retaliation.

  • 2

    nigelboy

    Sfjo330

    When you take a direct quote from a newspaper article, cite the source and don't play it off as your own. To continue with the article you sourced from,

    "Despite its pleas, Detroit's woes are homegrown, not created abroad. A report from the Treasury Department last month concluded that no major trading partner of the United States, including Japan, met the technical definition of manipulating its currency for unfair trade advantage. Although the real value of the yen is at its lowest point in 20 years, the Treasury Department noted that the Bank of Japan has not intervened in foreign exchange markets since March 2004."

    http://articles.latimes.com/2007/jan/30/opinion/oe-griswold30

  • 1

    jeff198527

    Japan isn't doing anything any other country currently isn't doing.

  • 1

    kurisupisu

    Physical gold (which I buy and sell) has risen sharply.It continues to rise. A gram of 24k gold is selling for 6000 yen or above Lack of censure of currency manipulation (QE) will cause inflation and will logically lead to the gold price increasing even more.

Login to leave a comment

OR

More in Business

View all

View all