As yen rises, Japan MOF, FSA, BOJ set to meet at 0450 GMT to exchange views

By: | Published: August 18, 2016 11:12 AM

Policymakers tend to worry when the yen rises, because it curbs exports and increases deflationary pressure by lowering import prices, but some traders say there are few options available because Group of Seven countries frown on competitive devaluation.

The MOF, the FSA and the BOJ announced the meeting in a joint statement earlier on Thursday, after Japan's top currency diplomat made a veiled threat to intervene in response to the yen moves Japan deems excessive. (Reuters)The MOF, the FSA and the BOJ announced the meeting in a joint statement earlier on Thursday, after Japan’s top currency diplomat made a veiled threat to intervene in response to the yen moves Japan deems excessive. (Reuters)

Japan’s Ministry of Finance, Financial Services Agency and the Bank of Japan will hold a meeting at 1:50 p.m. (0450 GMT) to exchange views on financial markets as the yen edges toward a seven-week high versus the dollar.

The MOF, the FSA and the BOJ announced the meeting in a joint statement earlier on Thursday, after Japan’s top currency diplomat made a veiled threat to intervene in response to the yen moves Japan deems excessive.

Policymakers tend to worry when the yen rises, because it curbs exports and increases deflationary pressure by lowering import prices, but some traders say there are few options available because Group of Seven countries frown on competitive devaluation.

The yen edged up 0.2 percent to 100.10 per dollar. It rose as high as 99.645 at one point, nearing a seven-week peak of 99.55 to the dollar set on Tuesday, due to receding expectations for near-term U.S. interest rate hikes.

Japan will act appropriately if there are any excessive moves in the forex market and will monitor markets closely, Vice Finance Minister for International Affairs, Masatsugu Asakawa told reporters earlier on Thursday.

Members of the MOF, FSA and BOJ regularly meet to discuss financial markets.
The yen has risen around 20 percent versus the dollar this year, which is weighing on exports and threatening to undermine business confidence.

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