BOJ’s Nakamura says cannot directly control FX moves with monetary policy

• It is desirable for FX to move in a way that reflects fundamentals
• Sharp, one-sided fall in yen heightens uncertainty
• Japan’s economy is not that strong yet
• Need to look at data in deciding when to start tapering bond purchases
• I am neutral on whether and when to taper bond buying
• Raising rates at next week’s policy meeting would be too early

This is one of the more dovish takes on BOJ policy at the moment. There is a strong expectation that they will reduce bond purchases this month. But Nakamura is evidently not as supportive as he is claiming that the economy is still in a rather fragile state.

This article was written by Justin Low at www.forexlive.com.