Group of Seven finance chiefs signaled tolerance of the yen's slide to its weakest since 2008, so long as it does not get out of hand.
Group of Seven signals acceptance of Japanese yen's weakness, for now
The Group of Seven finance chiefs signaled tolerance of the yen's slide to its weakest since 2008, so long as it does not get out of hand.
G-7 finance ministers and central bankers reaffirmed their February commitment to "not target exchange rates" at a meeting in Aylesbury, near London, the UK chancellor of the exchequer George Osborne said.
"The G-7 is inclined to endorse Japanese monetary policy as long as policy makers are not overtly" pursuing a cheaper yen, said Izumi Devalier, an economist at HSBC Holdings in Hong Kong.
While indicating acceptance of the yen's decline through 100 per dollar, policy makers said Japan's recovery programme was a key focus of their talks and that they will monitor the currency's performance. The yen has fallen 15 per cent against the US dollar this year and 13 per cent versus the euro as the Bank of Japan stepped up monetary stimulus.
"Everybody watches exchange rate developments," the German finance minister Wolfgang Schaeuble said. "We had a very intense discussion about Japan with our Japanese colleagues."
Canadian finance minister Jim Flaherty said that there were "expressions of concern" about exchange rates, although "all the countries in the G-7 consider themselves to be free- trading."
* Bloomberg News