Japan intervenes to counter currency weakness, sources say; yen surges

Japan intervened to prop up the yen on Thursday, marking its first bout of official intervention in nearly two years, two sources familiar with the matter told Reuters, which sent the currency up by as much as 3 percent against the dollar.

The sources, one government and another market source, spoke on condition of anonymity as they were not authorised to speak to the media.

The Nikkei earlier, citing a government source, said officials had intervened buying the currency, which had been around its weakest since July 2024 earlier on Thursday.

The dollar earlier fell by as much as 3 percent against the yen to 155.5 yen, its lowest since March 2, in what would have been its largest single-day drop since late December 2024. It was last down 2.2 percent at 156.76 yen JPY= by 1405 GMT.

Japanese Finance Minister Satsuki Katayama said earlier on Thursday that the timing to take "decisive action" in the market was nearing, in her strongest signal yet of potential currency intervention to prop up the sagging yen.

Top currency diplomat Atsushi Mimura also said the timing to take decisive action was approaching, adding that "extremely speculative" moves in the currency market were increasing. The Ministry of Finance has threatened intervention in currency and oil markets and on Thursday, reiterated that action could be "on all fronts".

"This is our final evacuation warning to markets," Mimura told reporters. When asked whether he was alluding to the chance of an imminent yen intervention, Mimura said: "I think market players would know what I mean."

The Japanese finance ministry's foreign exchange division could not be reached for immediate comment.

Japan last intervened to shore up the yen in July 2024.

Reuters

 

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