TOKYO, Feb 3 - Japan's Finance Minister Satsuki Katayama publicly defended Prime Minister Sanae Takaichi's recent comments about the potential advantages of a weaker yen, saying the prime minister was describing "what is written in textbooks."
At a routine press briefing, Katayama framed Takaichi's remarks as general observations on how a weaker currency can affect an economy. "The prime minister was speaking in general terms about the impact of a weak yen on the economy," Katayama said.
Katayama reiterated the specific points the prime minister had made, noting that Takaichi acknowledged there are negative aspects to a depreciating currency but also pointed to positive consequences. "She pointed out that, while there are negative aspects, there are also positive aspects, including stronger corporate sales as domestic investment increases and products made in Japan become easier to export overseas," the finance minister said.
The comments coincided with a market reaction: the dollar rose back above 155 yen after the prime minister, in a campaign speech over the weekend, emphasized the benefits of a weaker yen. That tone contrasted with the messaging from the finance ministry, which has in recent times worked to curb the currency's declines.
The finance minister's remarks sought to cast the prime minister's statement as a discussion of accepted economic effects rather than a policy shift. Katayama's characterization framed the prime minister's points as general economic theory applied to Japan's context, while still acknowledging the trade-offs that a weaker exchange rate can create.
Market participants noted the currency moved following the prime minister's weekend comments, illustrating how political remarks can influence short-term exchange-rate dynamics. The finance ministry's ongoing efforts to stem declines in the yen provide a contrasting posture to the prime minister's emphasis on potential benefits for exporters and domestic investment.
Key takeaways
- Finance Minister Satsuki Katayama defended Prime Minister Sanae Takaichi's comments, saying the prime minister referenced "what is written in textbooks."
- Katayama confirmed the prime minister pointed to both negative and positive aspects of a weaker yen, including higher corporate sales and easier exports as domestic investment rises.
- The dollar rose above 155 yen after the prime minister's weekend campaign remarks, which diverged in tone from the finance ministry's stance of trying to stem the yen's decline.