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Title: Reforming Japan’s Foreign Exchange Policy
Author: Masanaga Kumakura
Published: March 2012
Pages: 83-98
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Among major advanced countries Japan stands out with its large-scale, one-sided exchange market interventions and enormous foreign exchange reserves. While the country’s exchange market activism is often attributed to its obsession with export-led growth, there are institutional reasons why such a policy remains unchecked. This paper discusses the problems of Japan’s Foreign Exchange Fund Special Account, their relationship with its exchange rate policy, and their implication for the international financial system.

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