Yen slips after spurt

The yen fell slightly against the US dollar yesterday, reversing direction after a sudden surge late on Wednesday that traders and analysts were quick to attribute to intervention by Japanese authorities.

Traders had speculated Japan stepped in the market after the yen surged 3 percent within minutes from a level of around 157.58 per US dollar to as strong as 153.04 in the final stretch of the US trading session.

Columbia University academic and former finance ministry executive Takatoshi Ito said Japanese authorities likely intervened in the currency market to signal they see 160 yen to the US dollar as their line in the sand. "Intervention is effective if conducted in a timely manner," said Ito, who is an associate of former Bank of Japan governor Haruhiko Kuroda.

Meanwhile, economist Jim O'Neill noted that US officials already have a watchful eye on the yen and may resort to more "specific" and "public" rhetoric to help Japan stabilize its currency rout.