Fri, June 09, 2023

Japan’s $20 Billion Effort to Save The Yen

Yen

Japan used a record amount of 2.8T yen ($19.7B) of its easily accessible money to intervene in the foreign exchange market in support of the declining yen. This represents around 15% of Japan’s total available resources.

The amount was lower than the 3.6T-yen forecast made by traders on the Tokyo money market for Japan’s first dollar-selling, yen-buying intervention in 24 years to stop the steep depreciation of the currency. The ministry’s estimate, which shows the total amount spent on currency interventions from Aug. 30 to Sept. 28, is thought to have been utilized only for the intervention on Sept. 22. It would break the previous record of 2.62T yen set in 1998 for the largest dollar-to-yen exchange intervention. In November, confirmation of the spending dates will become public.

What Do Experts Predict for the Yen?

Daisaku Ueno, chief forex strategist at Mitsubishi UFJ (NYSE: MUFG) Morgan Stanley (NYSE: MS) Securities, said this was a tremendous burst of intervention. He emphasized Japanese authorities’ willingness to protect the yen. But as long as Japan continues to interfere alone, the impact of future action would wane, he added. The intervention came after the yen fell to a 24-year low of over 146 to the dollar. It caused a quick rise of more than 5 yen per dollar from that low, though the currency has subsequently drifted back to about 144.25.

At a meeting with cabinet ministers on Friday, Haruhiko Kuroda, governor of the Bank of Japan, stated that the recent abrupt, one-sided yen drops that make it harder for businesses to formulate business plans increase uncertainty. Therefore, it is undesirable and detrimental to the economy.

According to foreign reserves statistics on September 7, Japan had around $1.3T reserves, the second-largest behind China. 135.5B$ was a logged deposit with foreign central banks and BIS. Using such deposits as funding for more dollar selling and yen purchasing intervention is simple.

YOU MAY ALSO LIKE

Sec Chairman: United States Securities and Exchange Commission entrance architecture modern building closeup sign, logo, glass windows.

Bitcoin’s recent bounce-back from the $25,500 support level on June 6 has

Wibest – NZD USD: NZD USD digital trading chart.

The recent suspension of the US debt ceiling, along with positive indicators

dogecoin

  In the realm of crypto investing, being an early bird often

COMMENTS

Leave a Comment

Your email address will not be published. Required fields are marked *

User Review
  • Support
    Sending
  • Platform
    Sending
  • Spreads
    Sending
  • Trading Instument
    Sending

BROKER NEWS

Plus500 Sponsors BSC Young Boys for 2 More Years

An official announcement confirmed that Plus500 had prolonged its sponsorship deal with BSC Young Boys, a Swiss football club, for two additional play seasons. The Israeli brokerage company was previously named as the

BROKER NEWS

Plus500 logo sign on the office building.

Plus500 Sponsors BSC Young Boys for 2 More Years

An official announcement confirmed that Plus500 had prolonged its sponsorship deal with BSC Young Boys, a Swiss football club, for two additional play seasons. The Israeli brokerage company was previously named as the club’s