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Japanese Prime Minister Shinzo Abe on Wednesday rejected remarks made by U.S. President Donald Trump suggesting that Japan has been manipulating its currency and in doing so disadvantaging the United States.
Abe told a House of Representatives Budget Committee that the government's monetary policy, in twine with the Bank of Japan (BOJ), is aimed at reaching a 2 percent inflation goal.
He rebuked Trump's notion that Japan has been deliberately allowing the yen to become devalued.
On Tuesday Trump accused Tokyo of "playing the money market."
Following Trump's remarks, government and central bank officials expressed concerns that speculative buying of the yen could force its value up, which is not in the best interest of Japan's economy.
Abe's top spokesperson reiterated the Japanese leader's retort to Trump, saying: "It's not true at all.
Chief Cabinet Secretary Yoshihide Suga went on to say that the Japanese government will seek to communicate further with the United States regarding currency, trade and other economic issues, but said that in the meantime stable currency markets are of paramount importance.
"Stability in currencies is important and we will continue to monitor carefully developments in the currency market," Suga said.
Other senior officials were also quick to rebut Trump's accusation, with Masatsugu Asakawa, vice finance minister for international affairs, stating that exchange rates are market-led and are not being deliberately manipulated by Japan.
"Foreign exchange rates are led by the markets. We are not manipulating them. I don't quite understand what Trump actually meant," Asakawa said.
The dollar plummeted to a two-month low versus the yen at 112.08 yen in New York on Tuesday following Trump's remarks, but rebounded to the mid-113 yen zone in Tokyo on Wednesday.
Abe on Wednesday stressed the importance of developing better communication between Japan and the United States on matters such as currency, economy and trade.
The two leaders are scheduled to meet in Washington on Feb. 10.