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24/05/24
156
Japan Issues New Warning as Yen Declines
On Friday, Masato Kanda, Japan’s top currency diplomat said the country was ready to take appropriate action in markets to counter excessive yen moves, as he issued a new warning on the likelihood of fresh exchange-rate intervention.
Kanda added that he was in close and frequent contact with international counterparts, especially in the U.S., on financial markets and other issues.
Kanda told reporters that with a flexible exchange-rate regime, they wouldn’t have to intervene while currency moves were stable. If there were however moves that were excessively volatile and that adversely affected the economy, they had to take action, and it would be justified.
Kanda made these comments a day after Janet Yellen, the U.S. Treasury Secretary, said currency interventions should rarely be used and then only in a way that was well communicated.
Japan told its counterparts at the G7 finance leaders’ meeting that alertness was required against excessive volatility in currency markets that was due to speculative moves.
Kanda added it was important to respond appropriately to disorderly excessive currency market moves that would damage the economy.
He said Japan would push for the G7 communique to include language that reaffirmed the group’s stance that volatile and excessive currency moves were not desirable.
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