Japanese finance minister Yoshihiko Noda said today that Japan will continue to take decisive steps against excessive currency moves, including intervention, helping the dollar to recover further from a 15-year low against the yen.
Mr Noda's reiteration of Japan's currency stance highlighted the risk of another round of intervention to weaken the yen after Japan weathered a flurry of weekend Group of Seven and IMF meetings with no overt criticism of last month's yen selling - its first in six years.
Mr Noda said he explained to the weekend meeting of G7 finance leaders in Washington that Japan's latest intervention was aimed at keeping excessive currency moves from hurting the economy and the financial sector.
"The G7 reaffirmed that excessive currency moves would hurt stability in the economy and in the financial system ... From this standpoint we will take decisive steps, including intervention, when needed, while watching currency market moves with great interest," Noda told a news conference.
The dollar recovered to around 82.30 yen after hitting a 15-year low of 81.37 yen on the EBS platform yesterday.
Tokyo intervened in the currency market on September 15th as the yen's steady rise threatened to derail Japan's export-reliant recovery from its worst recession in decades.
Japan escaped overt criticism over the move from its G7 and G20 counterparts over the weekend as policymakers focused on broader solutions to tackle currency misalignments.
Economics minister Banri Kaieda said that Japan gained a certain understanding at the G7 meeting on its explanation of its currency intervention. He echoed Mr Noda's view that the yen's rapid rise is undesirable for achieving a self-sustainable recovery in the Japanese economy and beating deflation.
Reuters