Japanese authorities are prepared to take all necessary steps in the currency market since overly volatile movements are undesirable, Chief Cabinet Secretary Yoshimasa Hayashi said on Tuesday.
“It is critical that currency rates move consistently and reflect fundamentals. “Excessive volatility is undesirable,” Hayashi said at a routine press conference.
“We will closely watch exchange-rate developments and stand ready to take all possible measures,” he said.
Hayashi refused to answer when asked if Tokyo engaged in the currency market to prop up the yen for two days in a row last week.
Traders believe Tokyo interfered in the market to support a currency that has been stuck around 38-year lows, first on Thursday when a lower-than-expected US inflation data caused a spike in the yen, and again on Friday.
According to statistics from the Bank of Japan, Japan may have intervened for up to 3.57 trillion yen ($22.51 billion) on Thursday. Markets will be watching for money market data later on Tuesday to see whether Tokyo intervened last Friday as well.
On Tuesday, the dollar was trading at 158.62 yen, not far from the 160 level that Japanese officials perceive as a line in the sand for currency intervention.
Japanese authorities have lately made it common practice not to confirm whether they have engaged in the currency market or not.
( Source: Reuters)
