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Kuroda says BOJ will help keep FX moves stable, watching U.S. election fallout

TOKYO (Reuters) - Bank of Japan Governor Haruhiko Kuroda said the central bank will work closely with financial authorities to help keep currency moves stable, adding he was closely watching how the outcome of the U.S. presidential election could affect markets.

FILE PHOTO: Bank of Japan Governor Haruhiko Kuroda attends a news conference in Tokyo, Japan March 16, 2020, in this photo released by Kyodo. Mandatory credit Kyodo/via REUTERS

Kuroda said exchange rate moves have been relatively stable recently, helping lift Japanese exports and overseas investment.

“It’s extremely important to keep exchange-rate moves stable,” Kuroda told an online meeting with business leaders in Nagoya, central Japan, on Wednesday.

“As a central bank, we won’t act directly to stabilise markets. But we of course will work closely with financial authorities and overseas central banks to help keep currency moves stable,” he said.

The U.S. dollar jumped and risk-sensitive currencies weakened on Wednesday as early results in the U.S. presidential election showed a very tight race, prompting a wind-back of bets on a victory by Democratic challenger Joe Biden.

The yen also fell.

Kuroda said he was aware of various market views on how the U.S. election could affect dollar moves, but declined to give his take on the currency market outlook.

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“We’ll closely watch global and economic market developments, including those after the U.S. presidential election,” he said.

Nagoya and the surrounding Aichi prefecture is home to auto giant Toyota Motor Corp 7203.T and its parts suppliers, which are sensitive to sharp yen rises that hurt their profits.

In a speech delivered to the business executives, Kuroda said a resurgence in coronavirus infections in the United States and Europe was among concerns regarding the overseas outlook.

“The spread of COVID-19 has not subsided globally, including Europe and the United States, and public health measures have been tightened in European countries,” he said.

“Under these circumstances, the consequences of COVID-19 and the magnitude of their impact on domestic and overseas economies are highly unclear,” he added.

Reporting by Leika Kihara; Editing by Chris Gallagher and Kim Coghill

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