Sunday, January 27, 2013

Japan policy sparks Davos fears of ‘currency war'

Japan’s controversial new economic policy emerged as one of the hot topics at this year’s Davos forum, with talk of currency wars and strong rebuttals from Japanese officials.
The new government in Tokyo, led by Shinzo Abe, has pushed the Bank of Japan (BOJ) to step up efforts to battle nearly two decades of deflation and sluggish growth in the world’s third-largest economy.
The BOJ on Tuesday unveiled a new inflation target of 2 per cent and a massive programme of asset purchases to pump money into the economy, sparking accusations it had bowed to political pressure and compromised central bank independence.