Japan’s finance minister vows to closely watch FX moves By Reuters

TOKYO (Reuters) -Japan’s Finance Minister Katsunobu Kato reiterated on Tuesday that the authorities would be vigilant to foreign exchange moves, including those driven by speculators.

“We will continue to closely monitor foreign exchange moves, including those driven by speculators, with a higher sense of vigilance,” Kato told a regular news conference.

The yen is languishing at three-month lows as the loss of Japan’s ruling bloc’s parliamentary majority has raised expectations that the political turmoil could make it harder for the Bank of Japan to wean the economy off decades of monetary stimulus.

Later on Tuesday, Japanese economy minister, Ryosei Akazawa, said in a separate conference that a weak yen could affect the economy in various ways.

A weak yen “can push up prices through higher import costs, and if wages are not rising as much, that would push down real household income, depress the mindset of consumers and could result in lower private consumption,” he said.

The election results also heightened prospects that a new government will need to seek support from smaller opposition parties and ramp up spending to win public support.

“We plan to compile a meaningful economic package and supplementary budget by taking in policies from beyond party boundaries,” Kato said.