Japan Warns Against Speculative Yen Moves Amid Sharp Drop | Economy

The finance minister said the government and the Bank of Japan are on the same page about sharing concerns about currency depreciation.

Japan’s Finance Minister Shunichi Suzuki said the authorities were ready to respond to speculative currency movements.It was the first time in more than 20 years that Tokyo intervened in the foreign exchange market to stem the depreciation of the yen. This is a new warning issued a few days later.

Suzuki also said at a press conference on Monday that the government and the Bank of Japan (BOJ) share concerns about a sharp depreciation of the currency.

“I am deeply concerned about recent rapid and one-sided market movements, partly due to speculative trading,” Suzuki said at a press conference. In response to these moves, he added, “Our stance remains that we are ready to respond if necessary.”

The remarks came after the government decided Thursday to intervene in the foreign exchange market to stem the yen’s depreciation by selling the dollar and buying the yen for the first time since 1998.

yen’s recent plungeThe United States, which has pushed up the cost of living for households by pushing up the prices of imported fuel and food, is facing a growing divergence between aggressive monetary tightening by the Federal Reserve and ultra-accommodative monetary policy by the Bank of Japan. Due to the department.

Bank of Japan Governor Haruhiko Kuroda may address business leaders in Osaka, western Japan, later Monday to comment on the yen and government intervention.

The dollar climbed 0.29% to 143.78 on Monday and continued its rally towards Thursday’s 24-year high of 145.90. It fell to 140.31 on the same day after the Japanese authorities stepped into the market.

Jokes by government officials may keep markets nervous about the prospect of further intervention, but as Japan could face criticism from its G7 counterparts, it has repeatedly intervened in currency markets, pushing huge dollar Selling can be difficult.

“Japan is unlikely to continue to intervene to defend a particular line, such as 145 yen to the dollar,” Naoyuki Shinohara, a former Japanese currency diplomat, told Reuters.

The yen is not the only one in a downward spiral. Several other currencies, including the British pound, euro and Chinese yuan, have taken a hit, partly due to the US Federal Reserve’s aggressive interest rate hikes in recent months.