MOSCOW: Tokyo is closely monitoring volatility in foreign exchange markets and is ready to respond appropriately to sharp currency swings, Japanese Finance Minister Shunichi Suzuki said Friday, reported Sputnik.
“It’s not that we have a specific line of defense and we will take some sort of action if (a certain dollar-yen level) is crossed. We are constantly watching volatility,“ the Kyodo news agency quoted Suzuki as saying when asked if the Japanese government had a precise level for the yen-US dollar exchange rate at which it would introduce monetary measures.
The minister added that, given the situation, he believes the yen has weakened “significantly” against the US currency.
The yen has already fallen beyond the level at which the government intervened last year, the news agency added.
The weakening Japanese currency reflects the contradiction between the country’s central bank’s policy on maintaining low-interest rates and the Federal Reserve’s commitment to counter inflation by increasing them significantly, Kyodo also said.
On September 22, the Bank of Japan announced its decision to keep the interest rate at a negative level of -0.1 per cent as the inflation rate in Japan decreased to 3.2 per cent in August from 3.3 per cent in July.
The Japanese government is mulling all possible measures in the event of increased market volatility, Suzuki said following the announcement. He added that the Japanese Finance Ministry remained in close contact with monetary regulators of other countries, including the United States. –Bernama
