- Governor Kuroda warns BOJ may suffer losses suppose if it exits easy policy.
- US yet to verify pull back of Russian troops, weighs on the market mood.
- Japanese manufacturer’s business confidence fell to an 11-month low in February.
USD/JPY bids above 115.60 level during Wednesday Asian session. BOJ Kuroda’s warning and the mounting Russia – Ukraine Tensions are the key catalysts in directing the pair.
Governor Haruhiko Kuroda said on Wednesday said “The Bank of Japan could temporarily suffer losses on its huge asset holdings if it were to end its ultra-loose monetary policy.” “The BOJ holds huge amount of government bonds, which means reducing the size will take a long time if it decides to exit from ultra-easy policy in the future” Kuroda said.
Elsewhere, The Russian defence ministry on Tuesday published footage that demonstrated it was returning some troops to base after exercises, however, US President Joe Biden said the United States had not verified the move. Russia’s claim that it pulled back troops “would be good, but we have not yet verified that,” Biden said. “Indeed, our analysts indicate that they remain very much in a threatening position.”
And Ukraine has also expressed skepticism about Russia’s statements of a pullback. “We won’t believe when we hear, we’ll believe when we see. When we see troops pulling out, we’ll believe in de-escalation,” Ukrainian Foreign Minister Dmytro Kuleba said. US president Biden said, “let there be no doubt: If Russia commits this breach by invading Ukraine, responsible nations around the world will not hesitate to respond.”
As per the latest Reuters poll published early Wednesday morning in Asia, “Japanese manufacturers’ business confidence fell to an 11-month low in February as measures to contain the pandemic and high raw material costs hurt sentiment.”
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