Japan gov’t repeats readiness to act as yen nears 24-year low
TOKYO –Japanese policymakers on Wednesday reiterated their readiness to take “necessary action” against rapid yen moves, in the wake of a slide in the currency triggered by bets the U.S. Federal Reserve would raise interest rates higher and for longer.
When asked about the yen‘s sharp overnight falls, top currency diplomat Masato Kanda told reporters he was “concerned” over currency market moves.
“We are monitoring yen moves with a sense of urgency,” said Kanda, vice finance minister for international affairs. “We will respond appropriately to currency moves without ruling out any options,” he said, repeating warnings made last week.
Chief Cabinet Secretary Hirokazu Matsuno told a briefing on Wednesday the government would take necessary action should excessive yen moves continue. Rapid currency moves were undesirable, he added.
Japanese policymakers have struggled to slow the yen‘s recent sharp falls as investors have focused on widening policy divergence between the Fed’s aggressive rate hike plans and the Bank of Japan‘s pledge to maintain ultra-loose monetary policy.
The dollar climbed to near a 24–year peak against the yen on Wednesday after hotter-than-expected U.S. inflation prompted bets for even more aggressive monetary tightening by the Fed.
The dollar stood at 144.965 yen in the Asian session, edging closer to the psychologically important 145 mark.
Once welcomed for giving exports a boost, the yen‘s weakness is becoming a cause for headaches for Japanese policymakers, because it hurts households and retailers by inflating the already rising prices of imported fuel and food.
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.