Japan has denied any plans to the US, as over $ 1 trillion dollars will be sold in US treasury during trade negotiations, Finance Minister Katsunobu Kato Kato said on Sunday in Milan.
The denial came two days after Kato appeared on national television, indicating that the stake could be used as a negotiating card. He explained the comments after journalists expressed a clearer position for the government's position.
Speaking at a press conference, Kato explained that his earlier comments were in response to the question of whether Japan could confirm to Washington, allowing for easy unloading his Treasury.
“My comments were made in response to the question of whether Japan could explicitly persuade Washington as a negotiation tool in trade negotiations so that he would not sell his own Treasury shares easily,” saidTo. “The comments were not intended to recommend the Holdings Treasury.”
In a Friday interview, Kato had said that the Japanese Treasury Holdings, the largest in the world, could be used in trade negotiations as a “card” if cryptopolitan reportedTo.
This was the first time no Japanese official publicly acknowledged the state of the country's massive debt position as a potential form of a fight against the US when he was re -interviewed on Sunday, Kato stressed: “Whether Japan actually uses this map is a different question.”
Boj delays in evaluating hikes as Trump's tariffs put pressure on Japan's fragile recovery
Kato also repeated that the main role of their US Treasury's features is to give the government enough foreign currency to stabilize the yen if necessary. “It has been our position,” he said, “and we are not going to use the US Treasury Holdings to negotiate as a negotiating tool.”
The aim of the comment was to reverse the speculation triggered by the interview, which briefly increased the global bond markets.
In the meantime, Japanese bank (BOJ) is facing its biggest test in Tokyo, as governor Kazuo Ueda was located two years ago. On Thursday, Boj left short-term interest rates to 0.5%, despite earlier plans to tighten politics. The decision was followed by a new trade pressure on US President Donald Trump, whose fresh tariffs have made the already Fragile economic outlook of Japan.
During the post -appointment briefing, Ueda said that the inflation schedule was “somewhat rejected” to achieve the central bank's 2% goal. This line signaled that Boj pushes further interest rates, at least as long as it appreciates the complete impact of new tariffs.
However, there are inflation risks. Food prices continue to rise, it is assumed that wage increases remain and the yen is even more at risk of weakening. All three factors give BOJ space to completely walk away from his plan to raise prices.
Akira Otani, former Senior Economist of Boj and now Goldman Sachs Japanese Managing Director, said that raising interest rates under current conditions would be a high risk.
“BOJ's worst scenario is further postponing the achievement of 2% inflation, continuing the price increase due to high uncertainty,” he said.
Otani has led to the next rate of his forecast six months ago, waiting for Boj to operate until January. Goldman Sachs still hopes that Boj will reach a 1.5% political rate during the current cycle.
On Thursday, Boj also released his new economic outlook. The central bank hopes that the Japanese economy will hardly grow above this year. He also changed his inflation forecast and described the risk to the economy as “the downside.”
This phrase shows that Boj is less sure that the price increase will continue. However, Ueda told reporters that the bank is still committed to raising rates as the conditions improve. However, he admitted that there was “extremely high uncertainty” around the road ahead.
Over the last thirty years, Japan has not been able to shorten short -term interest rates by more than 0.5%. Every time the central bank tried to move towards political normalization, it was in the problems – be it weakly due to salary growth or global economic shocks. Repeated failures have kept the country stuck in the ultra-loose policy cycle.
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