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 Japanese Finance Ministry official Atsushi Mimura said on Tuesday, the government “is always communicating  and coordinating with other countries in case for FX intervention.” Additional quotes Mindful of maintaining safety and securing liquidity in FX reserves management. Can sell assets such as savings and foreign bonds in FX reserves when it is necessary to intervene. Market reaction At the time of writing, USD/JPY is rising 0.18% on the day to 150.37, as the above comments fail to offer any support to the Japanese Yen. Japanese Yen FAQs The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen. The Japanese Yen is…

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Filed under: News - @ February 20, 2024 7:24 am