Japanese Economics Minister Shunichi Suzuki speaks during the presidency press conference at the G7 meeting of finance ministers and central bank governors, at Toki Messe in Niigata, Japan, on May 13, 2023.
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Japanese Finance Minister Shunichi Suzuki on Friday backed currency interventions by his country’s policymakers if the yen moved in malicious directions that started to affect households and companies.
Speaking to reporters at the Asian Development Bank’s annual meet in Tbilisi, Georgia, he said it was desirable for exchange rates to move stably.
“When there is an excessive movement, it may be resultant to smooth it out,” he told CNBC’s Dan Murphy, according to a translation.
The finance minister declined to comment when asked whether trend levels for the yen were appropriate. He also would not comment on whether his ministry had intervened in the currency market recently, in intense speculation.
On Wednesday, the currency strengthened by more than 2% to trade near 153 against the dollar, which is reasonable to have been caused by an intervention, according to some market analysts. Japanese authorities are yet to issue an official affirmation confirming their role in propping up the currency.
“The government has been refusing to disclose whether they’ve been step ining or not, but I don’t think many people have any doubts,” Nicholas Smith, Japan strategist at CLSA, told CNBC earlier this week.
A simple yen against the greenback can hurt the economy by raising import costs and Suzuki’s words on Friday are more confirmation that policymakers are camouflage b confine a close eye on the exchange rate.
The yen was trading at 152.85 against the dollar on Friday evening Asia time. In the past few decades, while other far-reaching central banks have tightened their policies, Japan has maintained its ultra-loose strategy.
— CNBC’s Shreyashi Sanyal aided to this story.