There was “absolutely no” discussion of intervention in the currency markets to slow the yen’s rise against the dollar, Chief Cabinet Secretary Yoshito Sengoku told reporters today in Tokyo. He declined to comment on whether monetary easing was discussed during the 15-minute telephone call.
The conversation was held as slower growth and the yen’s climb to a 15-year high against the dollar puts pressure on policy makers to come up with measures to support the economy. Kan last week ordered his ministers to come up with fresh stimulus measures to spur the expansion.
Sengoku declined to elaborate on what else was discussed, saying disclosing that content could affect financial markets. The Bank of Japan said the two men also talked about the global economy and financial markets, including currencies, according to Tokyo-based spokesman Satoshi Yamaguchi.
Speculation of a gathering between the premier and governor fueled expectations that the bank may hold an emergency meeting as in December, when it relaxed policy before Shirakawa was scheduled to meet then-Prime Minister Yukio Hatoyama.
The central bank is still assessing the economic effect of the yen’s rise, according to three people familiar with the matter, an indication it has no immediate plans to ease monetary policy before its Sept. 6-7 gathering. The yen rose to 84.73 per dollar on Aug. 11, the highest since 1995 and traded at 85.36 as of 11:43 a.m. in Tokyo, from 85.62 in New York on Aug. 20.