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USD/JPY intervention - are the warning signs increasing?

Just a few thoughts and linking together of some comments - I'd be curious to get feedback from ForexLive traders on their thoughts on this

Yesterday we got comments from Japan finance minister Aso:

  • "For Japan, excessive volatility in yen moves that affect Japan's trade, economic and fiscal policies - be it yen rises or yen falls - is undesirable. If such moves occur, Japan is ready to intervene in the market"

Now, we've heard such commentary from him before (and note, in Japan the impetus for currency intervention will come from Aso's ministry - it's the Minsitry of finance that will instruct the Bank of Japan to intervene), but this does sound more pointed than what we've heard in the past.

Also Sadayuki Sakakibara, the head of Keidanren (Japan's biggest business lobby) said on Monday that

  • it was "natural" to take action against yen rises that were speculative & not in line with economic fundamentals.

Given the level of USD/JPY (off its lows and up nearly 300 points from those lows) I don't expect intervention is imminent (but I could be wrong) ... but will be on heightened alert if (when) USD/JPY makes a new cycle low.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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