- Real wages are still negative
- Recent inflation mostly driven by rising import prices
- Yen has weakened significantly so far this year
- Yen decline mostly driven by US rate hike outlook
- There are pros and cons to a weak yen, BOJ has to watch it carefully
- But there is not much BOJ can do when it is driven by changes in US economy
A couple of token remarks there by Nakamura. The bottom line is that the BOJ is still nowhere near moving away from its current policy stance and on the balance of things, it makes it tough to pick out the yen when in a crowd. Even when you consider safe haven bids now, the dollar seems more attractive given the prospects of rate differentials.