Japanese efforts to stem sharp increases in the yen could face increasing opposition from other major economies, making it even more difficult for premier Shinzo Abe’s administration to reflate the world’s third largest economy out of stagnation.
Senior government officials, including the country’s top spokesman, have escalated warnings to speculators against pushing up the yen too much, stressing their readiness to take “appropriate action” in the market against what they see as one-sided moves.
But the jawboning has failed to stop market participants from testing policymakers’ resolve with many betting Tokyo will not intervene unless the dollar falls below 105 yen or even 100 yen.
Finance Minister Taro Aso issued a fresh warning on Friday, saying that rapid currency moves were undesirable and that authorities will take steps as needed.
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Craig Erlam
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