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Weaker yen to disturb Asia’s monetary order: Sri Lanka central bank

Weaker yen to disturb Asia’s monetary order: Sri Lanka central bank

COLOMBO: Governor of Sri Lanka’s central bank said that the fall of yen against dollar has multiplied that could disturb Asia’s monetary order.

Ajith Nivard Cabraal said Sri Lanka would likely benefit, in the short term at least, since the sliding yen makes it easier for the country to repay yen-denominated loans and cheaper for it to buy Japanese-made goods.

But the governor said that central-bank policies that trigger significant depreciation set a dangerous precedent and make “it very difficult for others to deal with.”

The yen has fallen 4.7% against the dollar since the Bank of Japan unveiled new monetary-stimulus measures on Oct. 31. The risk, Mr. Cabraal said in an interview, was that other countries would also take steps that weaken their currencies.