JAKARTA - The Japanese government has again signaled vigilance after the exchange rate of the yen remained below 160 per US dollar, a level that previously triggered massive intervention in the foreign exchange market.
Quoted from a Kyodo News report, Tuesday, June 9, Japanese Finance Minister Satsuki Katayama confirmed that the government remains ready to take action if the weakening of the yen is considered excessive.
"There is no change. We remain in a position to take firm action if necessary," Katayama said Tuesday.
The statement came as the yen again moved closer to the level that has been a concern for market participants and Japanese financial authorities.
Japanese Ministry of Finance data, as quoted by Kyodo News, showed that the government poured 11.73 trillion yen or about US$73 billion into foreign exchange market interventions during the period from April 28 to May 27. The value is the largest in the history of Japanese currency interventions.
Foreign exchange market intervention is a government measure to buy yen or sell US dollars to hold back the weakening of the domestic currency.
However, the Japanese government has not detailed the use of the funds from day to day. Therefore, the exact time of the intervention has not yet been officially announced.
Before the intervention was carried out, the yen had touched 160.72 per US dollar on April 30. That position was the yen's weakest point since July 2024.
The Japanese government's move had raised the yen exchange rate to a strong 155 per US dollar. However, the strengthening did not last long.
In recent weeks, the yen has again been under pressure as demand for the US dollar has strengthened. The US currency is still the choice of investors looking for safe assets amid rising uncertainty due to the conflict in the Middle East.
The movement of the yen is now back in the market's attention. If the pressure continues and the exchange rate re-breaks the level considered sensitive by Japanese authorities, the opportunity for further intervention remains open.
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