Wednesday, July 4, 2007
“Japan’s situation is abnormal and lots of people are having a free lunch. There is something wrong here.”
Eisuke Sakakibara, Japan's former top currency official, said the central bank needs to increase interest rates soon because the yen's slide has fueled a ``dangerous'' bubble in carry trades. ``The cheapness of the yen has reached absurd levels and the only cause for that is low interest rates,'' Sakakibara said in an interview yesterday after a speech at the Federal Reserve Bank of San Francisco. ``The Bank of Japan needs to normalize interest rates as quickly as possible.''