Japanese government intervenes to save its local currency

Investors’ bets against the Japanese yen rose to the equivalent of $8.6 billion, as the Government of Japan intervened with the currency market last year at a similar level.

According to a report published by Reuters news agency, the Government of Japan believes that speculation on the yen is excessive, adding that the problem for Japan’s policymakers is their own policy.

At the end of last week, Japan’s Finance Minister Shonichi Suzuki stated in this regard that exchange rate movements are driven by supply and demand as well as various factors, explaining that the weakness of the yen has different effects on Japan’s economy such as exports and import prices, and Japan’s position on fiscal reform also affects long-term market confidence in the yen.

In previous remarks, Japan’s Finance Minister stressed the importance of guiding the country’s fiscal policy in line with international standards in order to maintain a stable financial environment in Japan, speaking on the recommendations made by the Ministry’s Finance Committee, which stressed the need to maintain the credibility of the yen as a guideline for political decision-making.

Japan’s finances also reported that the economic fundamentals that underpinned the yen’s credibility were no longer considered absolute and that policymakers must strive to maintain credibility in the Japanese yen.