Her top official on Japanese currency issues, Masato Kanda said that the recent weakness of the yen is curious and does not match currents, reaffirming his commitment to act if necessary to prevent excessive exchange rate fluctuations. “I strongly believe that the recent abrupt devaluation of the yen is unusual, given the fundamental economic elements, such as the trend and prospects of inflation, as well as the direction of monetary policy and returns to Japan and the US,” said Masato Kanda, Deputy Finance Minister for international affairs, in an interview with him today (29.3.2024). “Many people believe that yen is now moving in the opposite direction than it should be moving”. Kanda’s statements come amid intense market control over whether the government will intervene in the foreign exchange market to halt the recent fall of the yen following the Bank of Japan’s decision last week to increase interest rates for the first time since 2007. The currency was split to a low of 34 years, at 151.97 yen per dollar, on Wednesday (27.3.2024), which prompted Finance Minister Shunichi Suzuki to intensify oral warnings with its strongest hint this year that Japan could intervene.
Japan: ‘Unusual’ characterises the fall of the yen after interest rate cuts
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