Japan’s Finance Minister Satsuki Katayama on Friday reaffirmed the government’s readiness to intervene in the foreign exchange market as the yen weakened to its lowest level in nearly four decades against the US dollar.
“We’re prepared to respond appropriately on foreign exchange whenever necessary, and that means taking decisive action without hesitation,” Katayama told a regular news conference.
The remarks came after the yen fell to 163.96 per dollar, its weakest level since November 1986, amid rising oil prices and heightened tensions in the Middle East.
The sharp decline has fuelled market speculation that Japanese authorities could step into currency markets to support the yen.
On Thursday, the US Treasury Department, in its semi-annual currency report, said the yen’s weakness had persisted despite narrowing interest rate differentials between the United States and Japan, adding that excessive volatility in exchange rates was undesirable.
Responding to the report, Katayama said Japan and the United States share the view that excessive foreign exchange volatility is undesirable.
“We remain in close consultation at all times, 24 hours a day, 365 days a year,” she said.