The yen yesterday slipped as Tokyo officials kept up their war of words in a bid to tame the surging currency, while the greenback won support as weak US jobs data failed to extinguish hopes for rate hikes this year.
Japanese Prime Minister Shinzo Abe and other Tokyo officials have been warning over a possible market intervention to cut short the “speculative” rally that has seen the yen soar to 18-month highs against the greenback.
“Our position is that wide fluctuations and rapid movements are not desirable, as they can cause various impacts as far as trade policies and fiscal policies are concerned,” Japanese Finance Minister Taro Aso said yesterday in his latest comments on the issue. “We have always said, in these situations that we are prepared to intervene” in the market, he told parliament.
Last week, Abe said that “drastic fluctuations” in the yen’s value risked having a major negative impact on Japanese companies.
Japan last intervened in currency markets in November 2011, when it tried to stem the yen’s rise against the dollar to keep a recovery on track after the quake-tsunami disaster earlier that year.
“The yen likely saw its peak against the dollar for the time being,” Koji Fukaya, the Tokyo-based chief executive officer at FPG Securities, told Bloomberg News.
“The jobs report failed to add further momentum to speculators’ already bullish yen positions. Unless US data falter, the yen lacks fresh incentives to climb,” he said.
The much-anticipated monthly report, released on Friday, put last month’s job gains in the US at by far the weakest level of the year at 160,000, compared with the market’s expectation for 200,000.
Still, the dollar held its ground, buying ￥107.39, firming from ￥107.14 in New York on Friday, as a key US Federal Reserve policymaker said he expected continued growth in the US economy.
The euro strengthened in New York to US$1.1412 and ￥122.56, from US$1.1403 and ￥122.17, after Greek lawmakers adopted a controversial package of pension cuts and tax hikes as eurozone finance ministers geared up for an emergency meeting to hammer out fresh reforms for Athens to stave off another debt crisis.
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