BOJ Deputy Governor Himino (氷見野) said exchange-rate movements are one of the important factors affecting economic and price developments. He also discussed the impact of crude oil prices and the outlook for the situation in the Middle East, expressing the view that the Japanese economy will continue to grow moderately.
BOJ Deputy Governor Himino (氷見野) said that while monetary policy is not intended to control exchange rates, exchange-rate movements are nevertheless one of the important factors affecting Japan’s economic and price developments. He said it was also necessary to bear in mind that exchange rates could influence inflation expectations.
He said rising crude oil prices could weigh on the economy, while expressing the view that the risk of a significant economic downturn due to the situation in the Middle East had declined.
He also said that, as a factor affecting the South Korean economy, exchange-rate fluctuations had become more likely to affect prices compared with their past movements.
He reiterated the Bank of Japan’s view that the Japanese economy would continue to grow moderately, although its growth rate would slow.