Japan’s top official keeps markets guessing on yen intervention

Japanese officials resisted saying whether they had intervened in the market to support the yen on Wednesday, instead emphasizing their determination to act against excess volatility, putting markets on edge for the possibility of yen-buying intervention.

The yen gained dramatically overnight on Tuesday after falling below the psychologically critical 150 per dollar threshold to its worst level in a year, leading some market players to suspect Tokyo interfered to support the currency.

In a press conference, Finance Minister Shunichi Suzuki declined to comment on whether Tokyo had intervened but emphasized that currency rates must move steadily in keeping with fundamentals.

“We’re ready to take the required steps against undue volatility without ruling out any possibilities,” Suzuki said, echoing senior currency diplomat Masato Kanda’s sentiment.

Kanda said he saw Prime Minister Fumio Kishida later Wednesday to “address the economy in general,” indicating the government’s growing concern over the yen’s weakening.

Kanda declined to specify whether he discussed the yen with the premier, but following the meeting, he told reporters that any action would target volatility rather than currency values.

In Asia on Wednesday, the dollar lingered at 149.17 yen, well below the 150-mark, as comments from Suzuki and Kanda, who are in charge of choosing if and when to intervene, left investors on edge over intervention risks.