A few hours ago, the yen price fell to its lowest since November 2022 compared to the USD, when one USD was exchanged for 147.8 yen. This caused Japan's top monetary official to warn against speculation.
"If these moves continue, the government will resolve them with appropriate measures, not excluding any options," Deputy Finance Minister Masato Kanda Masato Kanda said to the press on September 6.
This statement helped the yen price increase slightly, to 147.3 yen per dollar, as the market considered the possibility of Tokyo intervention . But after that, the USD continued to strengthen, reaching 147.8 yen per US dollar.
USD/JPY exchange rate developments over the past year. Graph: Reuters
USD also increased in value compared to other major currencies. On September 5, the Euro fell to its lowest level in 3 months compared to the US dollar, at 1 EUR for 1.07 USD. The British pound also fell to a 3-month low, when it was exchanged for 1.25 USD.
Kanda said currencies should move in a direction that reflects underlying economic factors. However, yen last year and this year both had strong fluctuations. Authorities are closely monitoring the market, with a high level of urgency.
"These developments make businesses and households feel unstable. This has a negative impact on the economy," he said.
Yen has lost value in recent sessions, but Japanese officials have not taken action. They just regularly repeat statements of concern about large fluctuations in the local currency.
Yen weakened in the context of Japan maintaining short-term interest rates at -0.1% and the 10-year bond yield ceiling at 0%. This move is contrary to the European Central Bank (ECB) and the US Federal Reserve ( Fed ), causing investors to sell this currency to switch to other channels for higher profits.
Last year, Japan spent 62 billion USD to intervene after the local currency price lost 2 yen per USD in just 24 hours. "Today, the price fell more than 1 yen overnight, raising concerns about intervention. However, they have not been able to really intervene because the market believes that the 150 yen per dollar mark can cause officials to act." , said Tsutomu Soma – currency analyst at Monex.
Ha Thu (according to Bloomberg)
