The yen soared against the dollar on Thursday after Japan’s central bank signaled that further moves to ease policy and weaken the currency were unlikely.
But the main impetus for the yen’s move stemmed from reports that Bank of Japan policy makers view additional steps to ease monetary policy to shore up inflation as counterproductive.
[Note: He (and others) think inflation is a (import) price phenomenon]
That guy is due to leave the Board shortly.
The newest member thinks very differently:
The title of Yutaka Harada’s recent book says it all: “Reflationist Economics Has Saved Japan.” The Waseda University professor is a big believer in the monetary “bazookas”fired by Bank of Japan Gov. Haruhiko Kuroda, which have flooded the financial system with tens of trillions of yen in an attempt to create inflation.
For Mr. Harada, who was nominated Thursday to join Mr. Kuroda as one of the nine BOJ board members, this is no academic exercise. He contends in his book that a rise in Japan’s suicide rate during the 2000s–reaching a peak of more than 30,000 a year–was partly a byproduct of excessively tight monetary policy under Mr. Kuroda’s predecessors, which he says caused higher unemployment. “If the economy gets better, we can save one-third of those committing suicide,” he writes. And, in fact, the suicide rate fell 7% last year.