Market Volatility Sparks Government Intervention
As the yen continues to experience high volatility ahead of a crucial monetary policy meeting, Japan’s Finance Minister, Katsunobu Kato, has reaffirmed the government’s commitment to taking decisive action against excessive foreign exchange market fluctuations.
Sharp Movements Spark Concern
Speaking at the Japan National Press Club, Kato expressed alarm over the recent sharp movements in the foreign exchange market, particularly those driven by speculators. His comments come on the heels of Bank of Japan (BOJ) Deputy Governor Ryozo Himino’s statement that the central bank would debate a potential interest rate hike at its upcoming policy meeting.
Monetary Policy Under Scrutiny
BOJ Governor Kazuo Ueda has also reiterated the bank’s plan to discuss a possible rate hike at the meeting. The yen responded positively, rising by approximately 0.5% against the U.S. dollar to reach 157.225. Kato emphasized that the finance ministry will closely monitor the BOJ’s discussions next week, expecting the central bank to pursue an appropriate monetary policy that supports sustainable inflation growth.
Government Closely Watching
The government’s primary concern is ensuring that inflation reaches its 2% target in a sustainable manner. As such, Kato’s ministry will maintain a watchful eye on the BOJ’s decisions, ready to intervene if necessary to stabilize the foreign exchange market. With the stakes high, the world watches as Japan navigates this critical period in its economic journey.
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