Yellen addresses sharp moves in yen value, hints at Japanese intervention
US Treasury Secretary Janet Yellen acknowledged the notable fluctuations in the value of the Japanese yen this week, while refraining from confirming whether Japan had intervened to support the currency. Speaking at a press conference in Mesa, Arizona, Yellen dismissed the notion of commenting on the issue, claiming it to be a mere rumor.
Yellen expects yen interventions to be infrequent, calls for consultations
Nevertheless, Yellen pointed out that the yen experienced significant movement in a relatively short period, expressing the belief that interventions of this nature should be rare and accompanied by consultations. In the past week, Japanese authorities intervened twice, aiming to support the yen. The first intervention occurred after the yen weakened to a level beyond 160 against the dollar, a 34-year low. The second incident followed US Federal Reserve Chair Jerome Powell’s statement, in which he indicated an improbable interest rate hike by the US central bank. Powell’s remarks made it easier for yen purchases to influence the currency in a positive direction.
Bloomberg analysis suggests Japan’s substantial expenditure on intervention
A thorough investigation by Bloomberg into the Bank of Japan’s current account data suggests that Japan may have spent almost $60 billion on these intervention actions. As the week drew to a close, Finance Minister Shunichi Suzuki refrained from confirming Japan’s intervention in the yen’s value.
Yellen’s fluctuating stance on Japanese intervention
Yellen’s stance on Japanese intervention has varied over the past two years. She frequently refers to the long-standing agreement among Group of Seven nations to allow market forces to determine exchange rates. Additionally, Yellen maintains that intervention may only be justified to dampen volatility, not to influence exchange rates. These points were reiterated during her recent statement. However, on previous occasions when Japan intervened to strengthen the yen, she consciously avoided criticizing such moves.
Yellen emphasizes economic policies during Arizona visit
Yellen, who delivered the speech in Mesa, Arizona, was there to shed light on the economic policies implemented by the Biden administration. The Treasury Secretary further remarked in Sedona on Friday that any turning away from democracy would jeopardize the economic vitality of the United States.
About Our Company
©2024 Our News Website
