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While USDJPY saw intervention the U.S. Dollar Index climbed 0.6% to 111.28, hitting a fresh high for the year in the process.
Safe haven and liquidity buying as forwards favored the greenback.
National Australia Bank analysts on the yen intervention Thursday.
BoJ intervention – that would have been a MoF not BoJ initiative – which drove the pair down to a low of Y140.36.
Given the now even starker contrast between the BoJ’s policy stance and central banks everywhere else in the world and the fact intervention is working completely against the grain of Japan’s domestic monetary policy stance, MoF will need to be in this intervention game for the long haul and in size if it is to have much hope of arresting JPY weakness in an ongoing strong USD environment.
And short of resurrecting some sort of SNB style currency peg as the latter did with EUR/CHF (and which ultimately failed, even though the SNB was selling not buying its own currency) the law of diminishing returns will surely set in on BoJ intervention before too long.
Japan spent ¥2.8 trillion on currency intervention in the past month – MOF
This covers the period of 30 August to 28 September, with the total spent amounting to ¥2.8382 trillion (roughly $19 billion). That is less than the amount that was rumoured a few days ago and when pit against the country’s reserves of $1.29 trillion, this is peanuts.
Japan’s Prime Minister Kishida said that he is not looking to shorten the tenure of Bank of Japan Governor Kuroda, adding that he supports the central bank’s policy despite its effect on the yen.
Dollar Yen continues to melt up to 32-year highs, today hitting 149.95
U.S. Treasuries ended Wednesday on a sharply lower lifting yields to fresh highs for the year. Wider forward margins support USD
150.00 USDJPY beckons how say you BOJ?
Japan’s ministry of finance stepped into the foreign exchange market in October for just the second time, officially for the first time since 1998 to
[See the full post at: Japan Spent ¥6.35 trillion in October on Intervention to Support the Yen]
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