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Yen jumps sharply as Japan warns it is ready to intervene again

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<span>STORY: Japan’s yen jumped in a sharp move on Friday (May 1).</span><span>It comes after the country’s top foreign exchange diplomat warned Tokyo was ready to step back into markets.</span><span>Atsushi Mimura’s words came only hours after official buying lifted the currency.</span><span>The price move and comments led to speculation among currency traders of another round of intervention by Japan.</span><span>The U.S. dollar dropped in the London morning, falling by as much as 0.66% to a session low.</span><span>It wasn’t immediately clear what was behind Friday’s move, but analysts said after Thursday the market was on edge.</span><span>Tokyo’s ramped-up rhetoric comes as the yen stays under pressure from wide U.S.-Japan interest rate gaps.</span><span>And it’s also ahead of a holiday stretch officials fear could bring speculative attacks.</span><span>Japanese markets will be closed on Monday through Wednesday for Golden Week.</span><span>Analyst have said this could cause wild swings in the yen due to thin liquidity,.</span><span>Japanese Finance Minister Satsuki Katayama’s warned on Thursday “decisive action” was approaching.</span><span>She also told reporters to keep their smartphones on hand throughout the holidays.</span><span>This was seen as a signal of Tokyo’s readiness to intervene and put off speculators from exploiting thin liquidity to push the yen lower.</span><span>Two sources said Japan stepped into the market to support the yen just hours after Katayama spoke.</span><span>That would mark its first official currency intervention in nearly two years.</span><span>The reported move sent the Japanese currency as much as 3% higher.</span><span>Mimura declined to comment on whether Japan intervened in the currency market on Thursday.</span><span>He further said Japan is in “extremely close contact” with the U.S..</span><span>And both countries agree action may be needed depending on market developments.</span><span>The yen surged to 155.5 per dollar after Thursday’s intervention.</span><span>But it later trimmed some gains and stood at 156.99, still above the 160 mark seen as the Japanese authorities’ marker for intervention.</span>



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