An exchange rate between the Japanese yen devalued against the US dollar shows 150.19-20 in Chuo Ward, Tokyo on March 19, 2024. picture alliance / ASSOCIATED PRESS | Fuminori Ogane
Masato Kanda, Japan’s deputy finance minister for international affairs, strongly warns against speculation in the foreign exchange market, Bloomberg reports.
Kanda said the yen’s weakening was due to speculation. Japan is prepared for direct intervention in the foreign exchange market.
This year, the yen is the worst-performing G10 currency, losing 6.8 percent of its value against the dollar, the news agency said.
Masato Kanda, Japan’s deputy finance minister for international affairs, strongly cautions against speculation in the foreign exchange market as the yen remains near 2022 intervention levels, reports „Bloomberg“.
“The current weakening of the yen is not consistent with fundamentals and is clearly due to speculation,” he told reporters on Monday. He also stated that Japan was prepared for direct intervention in the foreign exchange market.
In 2022, Japan intervened to support the yen when the currency hit 151.95 against the dollar, it said „Bloomberg“. Since the Bank of Japan raised interest rates last week for the first time since 2007, the currency has been trading at $150-151. This year, the yen is the worst-performing G10 currency, losing 6.8 percent of its value against the dollar.
Much of the recent movements in the dollar-yen exchange rate have been driven by expectations that the Federal Reserve will cut interest rates. That would weaken the dollar against the Japanese currency. However, since these expectations were scaled back, the yen came under pressure again.
“The tone of verbal interventions is tightening and the yen could receive near-term support given the growing risk of real action,” Takeshi Ishida, a strategist at Resona Holdings Inc. in Tokyo, told the news agency.
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