Japan Intervenes Again In Forex Market: Sources
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2022-10-22 HKT 15:50
Japan intervened in the foreign exchange market on Friday to buy yen for the second time in a month after the currency hit a 32-year low near 152 to the dollar, a government official and another person familiar with the matter told Reuters.
Japan has been attempting to shore up its battered currency as the central bank sticks with ultra-low interest rates, countering a global trend of tightening monetary policy and widening the gap between US and Japanese interest rates.
After the dollar rose to 151.94 yen, its highest since 1990, the intervention drove it down more than 7 yen to a low of 144.50 yen. The US currency was last down 1.8 percent at 147.34 yen.
Japan's Ministry of Finance (MOF) intervened in several stages from around 9:35pm, one source said.
Speaking to reporters shortly after the yen spiked, Japan's top currency diplomat, Masato Kanda, declined to comment on whether the MOF had intervened, according to Jiji news agency.
The MOF also bought yen on September 22, as investors focused on the widening divergence between the BOJ's ultra-loose monetary policy and the US Federal Reserve's aggressive rate hikes.
Finance Minister Shunichi Suzuki and Kanda have repeatedly signalled the government's readiness to intervene, warning against excessive volatility. Suzuki said before the intervention on Friday that the authorities were ready to act "strictly" against speculators.
Many market players doubt whether Tokyo can reverse the yen's downtrend with solo intervention, even with Japan's $1.33 trillion in foreign reserves. Japan bought a record 3.6 trillion yen in the September action, Tokyo money market brokerage firms estimated. (Reuters)
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