WASHINGTON (Reuters) - Japanese Finance Minister Taro Aso said he didn’t see a problem with U.S. President Donald Trump’s recent comments about the dollar “getting too strong,” as his Treasury secretary later clarified that the president was not seeking to talk the currency down.
Aso also said it was a “big achievement” for Japan that G20 finance leaders reconfirmed their commitment at last month’s meeting in Germany that excessive currency volatility was undesirable, language Tokyo interprets as justifying stepping into the market to counter abrupt yen spikes that hurt exports.
Japanese premier Shinzo Abe and Trump agreed at a summit in February that they would not directly discuss currency policy and leave the subject to their finance ministers.
But Trump’s comments to the Wall Street Journal earlier this month that the dollar was “getting too strong” appeared to violate that agreement. U.S. Treasury Secretary Steve Mnuchin played down the comment days later, saying Trump was “absolutely not” trying to talk down the dollar’s strength.
“I don’t see the comment as a problem as the U.S. Treasury secretary later clarified Washington’s stance,” Aso told reporters on Thursday, when asked about Trump’s comment.
Aso, however, said he reconfirmed in a bilateral meeting with Mnuchin on Thursday that exchange-rate policy would be dealt with among the two finance leaders.
Currency issues were among topics Aso and Mnuchin discussed at the bilateral talks, although they did not talk specifically about recent dollar/yen levels, a senior Japanese finance ministry official later told reporters.
“The two reconfirmed the G7 and G20 agreements on currency policy,” the official said.
Aso and Mnuchin met on the sidelines of the G20 finance leaders’ gathering and International Monetary Fund meetings in Washington D.C.
Aso said he told a G20 working dinner on Thursday that while global economic prospects were brightening, uncertainty clouded the outlook with financial market showing some volatility.
“I told them we shouldn’t be complacent and should continue to pursue necessary policy steps even though the economy was recovering,” Aso said.
Some G20 countries also discussed China’s steel production over-capacity and excessive debt build-up as a potential risk to the global economy, Aso said.
The IMF revised up its global growth estimates on improvements in trade activity, though the optimism was tempered by uncertainty over the Trump administration’s trade policies.
Reporting by Leika Kihara; Editing by Chris Gallagher and Sam Holmes