Japan ‘ready’ for more yen action

The
governor of Japan’s central bank has not ruled out further interventions in the
currency markets in its fight to control the rising value of the yen.

Speaking
at a conference in Kobe, Masaaki Shirakawa said the Bank of Japan (BOJ) was
“ready to implement appropriate action” if required.

The BOJ
intervened in the currency markets for the first time in six years earlier this
month.

Its
decision to sell large amounts of yen helped drive down the currency.

Previously
the yen had reached a 15-year high against the dollar – a concern for Japan’s
exporters who are seeing their profits squeezed by the poor exchange rate.

 Mr Shirakawa said the BOJ would
closely watch the impact the strong yen is having on the economy.

“We
have to pay more attention than before to the downside risk to the
economy,” he said.

“We
are ready to implement appropriate action in a timely manner if judged
necessary.”

The
comments came two days after the central bank was suspected of intervening in
the markets for a second time, leading to a sharp fall of more than 1% in the
value of the yen against the dollar.

Later
the Japanese prime minister Naoto Kan said he was unaware of a second
intervention by the BOJ.

Since
then the yen has risen again and is now at 84.212 yen to the dollar.

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