Yen Hits 3-Month Low, Japan Eyes Market Action.
Solid ECN - The Japanese yen dropped beyond 150 against the dollar, reaching a three-month low due to unexpected high inflation in the US, which makes it less likely for the Federal Reserve to lower interest rates soon. This significant fall in the yen's value led Japan's finance minister, Shunichi Suzuki, to warn that the government was watching the market. However, he did not say if they would step in again.
The Vice Finance Minister for International Affairs, Masato Kanda, mentioned that Japan might take necessary measures in the foreign exchange market to prevent economic harm from the yen's rapid decline. In 2022, Japan intervened in the currency market three times when the yen hit a 32-year low of 152 against the dollar and has not intervened since. Meanwhile, investors are looking into the Bank of Japan's future monetary policy, especially after hints that it may not increase rates sharply, even if it moves away from negative interest rates.