If the Japanese yen weakens, the Bank of Japan is likely to intervene in its favour. As has happened recently. However, the statement from leading Japanese authorities should convince the markets that there is no point in speculating on the yen’s decline.
Japan won’t comment on moves to counter the weakening yen
Japanese Finance Minister Shunichi Suzuki did not want to answer reporters’ questions on whether the government will take action if the Japanese yen is subject to speculation on its depreciation. “I won’t comment on that. We are permanently monitoring the development of our currency, and with increased attention,” Suzuki said in response to reporters’ questions.
Japanese currency at multi-year low
In fact, the Japanese yen recently hit its lowest level against the dollar in 32 years, with one dollar trading near the 149 yen mark. However, there have been assurances from important quarters that Japan will “take decisive action” if the yen again comes under attack from speculators who are betting on its depreciation.
The authorities are making it clear that there is no point in speculating on the yen’s decline because such a deal may simply not pay off. And the verbal intervention in favour of the yen seems to have borne fruit at the start of the new week. The yen has firmed up slightly.
