The remark underscores how a weak yen has become a tricky political issue for Japan’s finance ministry, which has historically focused on preventing a strong currency from hurting the country’s export sector.
“That has changed somewhat this year,” as jitters over a resurgence in COVID-19 infections and the varying pace of recovery in each country induced risk-off sentiment, he said. “The demerits of a weak yen are that it pushes up the import cost of energy and food, thereby increasing household burdens,” he said, acknowledging“There are both positive and negative effects [on the economy] from a weak yen. It’s hard to say which is bigger, because the pros and cons of a weak yen differ for each entity.
But Kanda stressed that global energy and commodity inflation, rather than the weak yen, was mostly to blame for pushing up the cost of living for households., the government plans to submit a bill to parliament that allows it to screen foreign investment in key infrastructure.