TOKYO (Reuters) – Japan may have to take appropriate action in case of disorderly foreign exchange moves driven by speculation, the government’s top currency diplomat Masato Kanda said on Tuesday.
“It is preferable for exchange rates to remain in a stable manner following fundamentals, and if the market is functioning soundly in this way, there is of course no need for the government to intervene,” Kanda told reporters.
“However, when there are excessive fluctuations or disorderly movements due to speculation, the market is not functioning and the government may have to take appropriate action. We will continue to take the same firm approach as we have in the past.”
Tokyo is suspected of having spent more than 9 trillion yen ($58.4 billion) to support its currency last week, as suggested by data from Bank of Japan, taking the yen from a 34-year low of 160.245 per dollar to a roughly one-month high of 151.86 over the span of a week.
Kanda said it is usual for a currency authority to not disclose whether it has carried out a market intervention, when asked about recent speculations that Japan has conducted yen-buying interventions to prop up the weakened currency.
($1 = 154.1800 yen)
(Reporting by Satoshi Sugiyama; Writing by Kantaro Komiya; Editing by Christian Schmollinger and Stephen Coates)
This article was originally published by a www.marketscreener.com . Read the Original article here. .