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Japan central bank governor says G20, IMF accept BOJ's monetary policy
April 25, 2017 / 8:01 AM / 6 months ago

Japan central bank governor says G20, IMF accept BOJ's monetary policy

Bank of Japan (BOJ) Governor Haruhiko Kuroda attends a Reuters Newsmaker event in Tokyo, Japan March 24, 2017. REUTERS/Toru Hanai

TOKYO (Reuters) - Bank of Japan Governor Haruhiko Kuroda said on Tuesday that Group of 20 and International Monetary Fund officials accept the view that the central bank’s quantitative easing policy is to achieve its inflation target.

Kuroda, speaking in the lower house fiscal and monetary policy committee, also said a statement released after the IMF’s spring meeting showed agreement that monetary policy should support economic growth.

He said currencies were not debated at the meeting.

Kuroda was questioned about the IMF and the G20 amid growing concern that Japan’s exports and monetary policy could come under criticism after IMF members dropped a previous pledge to fight protectionism amid a split over trade policy.

“The IMF released a statement that re-affirms previous agreements that central banks should pursue their mandate to support economic activity and attain price stability,” Kuroda said.

“At the meetings I was able to earn the understanding that we are conducting policy to meet our inflation target.”

A communique from the IMF’s steering committee on Saturday dropped an anti-protectionism pledge, adopting language from the Group of 20 nations that the U.S. government sought last month in Germany as it develops a strategy to slash U.S. trade deficits.

Instead, the International Monetary and Financial Committee statement pledged that members would “work together” to reduce global trade and current account imbalances “through appropriate policies.”

Some policymakers in Japan are worried that the U.S. government will focus more on currency levels as a way to reduce its trade deficit, which could open the BOJ to criticism because its quantitative easing has weakened the yen versus the dollar.

Since 2013, when Kuroda launched quantitative easing by buying massive amounts of government debt, the BOJ has insisted that its monetary policy is to meet its 2 percent inflation and any impact on currencies is incidental.

However, the yen has fallen around 15 percent versus the dollar since the start of quantitative easing, which tends to increase Japanese exporters’ earnings because it makes their products cheaper overseas.

Reporting by Stanley White; Editing by Sam Holmes

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