Bank of Japan Governor Ueda says monetary policy does not seek to control forex rates

Ueda is in the Diet, taking questions.

• Says monetary policy is aimed at impacting inflation, not the yen rate
• will examine the impact of movement of the yen on the economy
• FX moves could have a big impact on the economy and prices, and so the impact of FX volatility could be bigger than in the past
• BOJ does not seek to directly control FX rates with monetary policy
• FX moves are among various factors that affect the economy and prices
• weak yen pushes up import costs, has an impact on the the economy in other ways, such as via demand
• the Bank of Japan may need to respond via monetary policy if such impact for yen moves affects trend inflation
• we expect trend inflation to gradually head towards 2%

• We will adjust monetary policy as appropriate if trend inflation
  heads toward 2% as we project, or if we see risk of inflation
  overshooting our forecast

USD/JPY is little changed after Ueda, and Suzuki a bit earlier. Circa 154.75.

This article was written by Eamonn Sheridan at www.forexlive.com.