Kishida “We have to decide first with the governor of the Bank of Japan”
Exacerbating the weak yen due to long-term monetary easing
The Japanese government and the central bank, the Bank of Japan, announced that they have no immediate plans to change their monetary easing policy, which is one of the pillars of Abenomics.
Regarding the review of the joint statement between the government and the central bank, the Bank of Japan, which served as the basis for promoting monetary easing, Japanese Prime Minister Fumio Kishida said, “It is premature to talk specifically about its review at this stage,” the Nihon Keizai Shimbun (Nikkei) reported on the 27th reported day.
After coming to power in 2012, former Prime Minister Shinzo Abe promoted Abenomics, which included so-called ‘three arrows’, including very strong monetary easing, an active fiscal policy, and a growth strategy, in order to reviving the Japanese economy which had fallen into a long slump In particular, monetary easing was achieved by actively buying Japanese government bonds while maintaining a low interest rate environment.
Specifically, monetary easing is based on a joint statement issued by the government and the Bank of Japan in January 2013, right after former Prime Minister Abe took office for the second time. The joint statement states that the aim is to achieve inflation of 2% as soon as possible.’
Recently, however, Japan’s monetary easing policy has become a boomerang for the national economy. As the yen weakened, the scale of the trade deficit increased, and the living difficulties of the Japanese people deepened due to high prices. Reports continued that the Japanese government would change the content of the joint statement.
However, Prime Minister Kishida attended a lecture held in Tokyo the day before and said, “First of all, it is a story to be decided after deciding the governor of the Bank of Japan.” It is understood that he expressed his intention to seriously discuss revising the joint statement after appointing a new governor to the Bank of Japan after the term of Governor Haruhiko Kuroda, who has supported ‘Abenomics’ while leading the Bank of Japan since 2013. , coming to end in April next year.
On the other hand, local media such as the Mainichi Shimbun reported that Prime Minister Kishida was hit hard by the decision to dismiss the Genya Akiba Revival Prize, which had been controversial over issues related to political funds and Family Federation World Peace and Unity. (formerly the United Church), on the same day. Reconstruction Minister Akiba is expected to submit his resignation to Prime Minister Kishida at the Prime Minister’s official residence on the same day. The Akiba Reconstruction Prize has faced a series of political fund issues, including the fact that a political organization linked to him paid about 14 million yen (about 130 million won) to rent it to his mother and to a wife, who owns offices in Sendai City. If Prime Minister Kishida accepts his resignation, four cabinet members will resign in two months from October.
Reporter Park Shin-young nyusos@hankyung.com
