G-7 Statement May Obstruct Foreign Bond Purchases by BOJ

The Group of Seven’s position on currencies could make it difficult for the Bank of Japan to purchase foreign bonds to fight deflation and weaken the yen, an idea the ruling party has proposed.

The G-7 released a statement yesterday that appeared to signal acceptance for Japanese policies that lead to a weaker currency, so long as Prime Minister Shinzo Abe’s government doesn’t actively pursue devaluation.