Japan's Policy makers continue to prefer a weak JPY

BoJ Governor Haruhiko Kuroda's comments on 10 June about the JPY REER being very weak led to significant FX market volatility. 

Any change in local policy makers' views on USD-JPY is not seen, they continue to prefer a weak JPY as long as it does not raise concerns among its trading partners. 

Under Abenomics and the BoJ's massive monetary easing programme, boosting corporate profits via a weaker currency remains a key mechanism to reflate the economy.

Rising profits should translate into wage increases, which will be crucial to revive private consumption.