TOKYO, June 28 (Xinhua): Japan’s Vice Finance Minister for International Affairs Masato Kanda said on Wednesday that an appropriate respond to excess volatility in foreign exchange markets would be made.
The top currency diplomat’s remarks were made following the U.S. dollar’s spike to a seven-month high, past the 144 yen-mark, and came on the heels of similar warnings from other authorities about rapid, one-sided moves versus the dollar.
“We will closely watch developments in the currency market with a sense of increased urgency and respond appropriately if (forex) moves become excessive,” Kanda told a press briefing.
The U.S. Federal Reserve and other major central banks in Europe are aggressively hiking their interest rates to tame inflation compared to the Bank of Japan’s ultra-easy policy, which witness a widening interest rate gap between the countries, with the divergent policies a leading factor in the yen’s weakness.
Numerous times in the previous year, the last being in October, Japan intervened into the currency market and launched yen-buying operations using U.S. dollars to redress the yen’s weakness, with the forays into the market following a series of similar warnings such as those issued by financial authorities recently.