Image: Reuters Berita 24 English - Friday, Japanese Finance Minister Shunichi Suzuki refrained from commenting on the likelihood of governme...
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| Image: Reuters |
Berita 24 English - Friday, Japanese Finance Minister Shunichi Suzuki refrained from commenting on the likelihood of government action in the foreign exchange market while reiterating his admonition against rapid volatility.
When asked about the potential of intervention as the yen touched fresh 20-year lows against the dollar this week, Suzuki told reporters, "I won't comment on currency levels, including the question (of intervention)," to avoid causing any damage from a casual comment.
"Currency stability is vital, as quick movements are undesirable," Suzuki stated at a news conference. We will continue to closely monitor currency market fluctuations and their impact on the Japanese economy.
The Japanese yen reached a low of 134.56 yen per dollar on Thursday. It last traded at 134.21 yen per dollar, remaining close to establishing a new 20-year low.
According to Daisaku Ueno, chief forex strategist at Mitsubishi UFJ Morgan Stanley Securities, the depreciation of the yen has certainly put the Japanese government in a bind.
Ueno stated, "Verbal intervention is ineffective, and the yen has not reached a danger zone around 145 yen that I believe demands physical intervention."
Ueno stated that Japan may theoretically intervene unilaterally while notifying U.S. officials in advance of such a move.
Yellen is a firm believer in market-determined exchange rates, especially at a time when the U.S. is confronting rising inflation, he added.
Suzuki stated that the Japanese government would respond in accordance with the Group of Seven's foreign exchange agreement.
