Tokyo: The Japanese authorities are “on standby” to respond to recent sharp moves in the yen, the country’s top currency official said on Wednesday.
Japan’s Vice Finance Minister for International Affairs Masato Kanda made the comment as the Japanese currency dropped to a one-year low against the U.S. dollar, expressing concern over “one-sided, sharp” yen movements.
The yen briefly weakened to the upper 151 range in New York on Tuesday, a level not seen since October 2022, after the Bank of Japan loosened its grip on long-term government bond yields but maintained monetary easing.
Investors took the view that the central bank’s decision to tweak its monetary policy was not a major revision. The yen continued to fall in Tokyo trading early on Wednesday.
Kanda told reporters that the authorities were “on standby” to take all possible steps to counter excessive volatility in the currency market, but he declined to say what kind of action they could take.
The yen recouped some of its losses after Kanda’s comments. Investors have been selling the yen mainly due to the widening interest rate gap between Japan and the United States as the Federal Reserve has been raising interest rates aggressively to tame inflation.
