companies concerned by Trump currency manipulation comments
The Japanese business community expressed concern Wednesday
about the ramifications of U.S. President Donald Trump's claim the
previous day that Japan has been devaluing its currency, with some
officials alarmed at the possibility of a stronger yen.
An executive of an automaker said that while it was hard to
immediately assess the impact of Trump's criticism on the company's
performance, a stronger yen "would really hurt."
At a meeting in Washington with pharmaceutical company
executives on Tuesday, Trump said, "You look at what China's doing,
you look at what Japan has done over the years. They play the money
market, they play the devaluation market and we sit there like a
bunch of dummies."
Trump made the accusation after Bank of Japan Governor Haruhiko
Kuroda earlier Tuesday dismissed criticism that Japan's ultraeasy
monetary policy is aimed at weakening the yen.
An official of a major steelmaker said the BOJ's monetary policy
is aimed at boosting prices in Japan to end decades of deflation. If
that premise is questioned "the global economy, including Europe,
could be thrown into turmoil," the official said.
Other Japanese business people cited the threat to domestic
demand and corporate earnings if the yen were to strengthen due to
actions by the new Trump administration.
Another official of a major steel company also expressed
concern, saying if exporters like carmakers began producing less,
demand for steel would drop.
Japanese industrial conglomerate Toshiba Corp. could even fall
into negative net worth if the value of its foreign-denominated
assets declines because of a strengthening yen. Toshiba recently
warned that it already expects to book a charge of "several billion
dollars" to write down the value of its U.S. nuclear business.
Moreover, the yen's appreciation could hurt Toshiba's profitable
chip operation, which the company sees as a key driver of its revival.
But many people in the business community also said it was too
early to react to every word Trump utters as his administration has
just begun its work. (Feb. 1)