Japan’s finance minister warns of currency risks

Tuesday, 2 November 2010 23:04 -     - {{hitsCtrl.values.hits}}

TOKYO, (AFP) - Exchange rate fluctuations could further damage Japan’s faltering economic recovery, the finance minister warned Tuesday, voicing discomfort at the yen’s rise close to a post-war high.

The Japanese economy “has recently been at a standstill,” Finance Minister Yoshihiko Noda said in a prepared speech to parliament, according to Dow Jones Newswires.

“There are expectations that the economy will pick up on the back of improvements in overseas economies and the effects of various policy steps.

“But there are also concerns that a possible deterioration in foreign economies as well as fluctuations in exchange rates will put further downward pressure on the economy,” he said.

Noda called on lawmakers to quickly pass a planned 4.851-trillion-yen (60-billion-dollar) supplementary budget to help cushion the impact of the strengthening yen.

Bringing Japan’s economy firmly back to a recovery track “requires the enactment of this supplementary budget as soon as possible,” Noda added.

The yen was trading around 80.50 to the dollar on Tuesday, close to 79.75, its high since World War II, hit in April 1995.