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JAPAN GOVERNMENT STANDS READY TO ACT TO CURB YEN VOLATILITY

A Japanese official said to the reporters at a conference on December 25 that volatility was rising in the currency market and the government stands ready to take necessary steps if the market becomes too erratic.

“Volatility is going up. Each country shares the G7/G20 view that excess volatility and disorderly moves are unprecedented for the economy,” said Vice Finance Minister for International Affairs Masatsugu Asakawa.

“We will keep close watch on market moves with a sense of urgency, while thoroughly checking to see if there’s any speculative move,” he said.

Talking after a meeting with his counterparts from the Bank of Japan and Financial Services Agency to confer market developments, Asakawa believed the government would take action as appropriate if volatility increases.

Asakawa’s comments underscored Japan’s concerns with reference to the return of a strong yen. Authorities likely to be sensitive on signs of the yen gaining strength as a strong currency would undermine the country’s export-led economic recovery.

The dollar fell to a four-month low of 110 JPY against the safe-haven yen on Tuesday as Nikkei index dropped more than 5 percent to a 20-month low after a slide on Wall Street deepened amid U.S. political turmoil.

Economic fundamentals in Japan and the United States remained firm and they were in a gradual recovery trend in this regard.

Source: https://www.reuters.com/article/us-japan-economy-mof/japans-top-currency-official-says-govt-ready-to-act-to-curb-yen-volatility-idUSKCN1OO0FZ

 

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