Tetsushi and Leika Kajimoto

TOKYO (Reuters), Haruhiko Kuroda, Bank of Japan Governor, said Monday that recent moves by the yen have been “quite abrupt” and could harm companies’ business plans. This was his most severe warning so far about the dangers arising from the currency’s decline.

Kuroda maintained that his overall assessment of a weak yen being good for the economy was unchanged, as it raises the value foreign profits earned by Japanese businesses.

However, he said the yen’s fall to between 125-126 Japanese yen and the dollar from about 115-116 in a month back was too volatile to help companies.

Kuroda stated that the recent fall in the yen (which lost approximately 10 yen per dollar over a period of about one month) was quite dramatic and could hinder companies’ ability to create business plans.

“In that context, we have to consider the negative effects” of a weakening Japanese yen,” he stated.

The comment was a buy by traders, which helped push down the dollar’s value to 126.25yen Monday.

Kuroda however reiterated his belief that the BOJ should maintain its huge stimulus program to sustain a fragile economic recovery.

Due to the possibility of widerning U.S./Japan interest rate differences, the yen is now at its lowest level in two decades. The BOJ has been seen keeping extremely low interest rates, despite steady Federal Reserve rate rises.

Kuroda, a former currency diplomat has always argued for a weak Japanese yen in spite of growing concerns among legislators that an increase in yen prices could cause inflation and damage to the economy.

He is closer to Shunichi Suzuki’s latest comments, who last Monday reiterated his warning about the potential dangers of recent yen declines for the economy.

Suzuki stated that a weakening yen was not desirable in a market like this, where companies are still struggling to raise wages and prices. It’s actually a bad decline in the yen.

Suzuki did not respond to a question about whether Tokyo is ready to intervene in currency markets to stem the declines of the yen.

Takeshi Minami of Norinchukin Research Institute, chief economist said that Kuroda could have aligned with his views a bit more closely to those of the finance Minister to prevent markets from getting the impression they don’t see eye-to-eye on the issue.

“But, I doubt the BOJ will influence currency rates. That’s beyond their mandate.”