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Japan spends USD41B in single day to support yen amid rapid decline
(MENAFN) On April 29, Japan conducted a record-breaking intervention in the foreign exchange market, spending 5.92 trillion yen (approximately 41 billion U.S. dollars) in a single day to support the yen amid its rapid decline against the U.S. dollar. This unprecedented move aimed to counteract the yen’s steep depreciation, which had seen the currency fall to a 34-year low against the dollar.
According to quarterly data from Japan's Finance Ministry, this record intervention was followed by an additional 3.87 trillion yen spent two days later, marking the first official confirmation of yen-buying, dollar-selling operations for the period between April and June. These interventions, totaling 9.79 trillion yen, managed to strengthen the yen by approximately 5 percent from its lowest point of 160.24 yen per dollar. However, the interventions were ultimately insufficient to halt the yen's overall decline.
Following the initial intervention, the yen briefly recovered, with the dollar falling to about 154 yen on April 29 and further to the 153 yen range on May 1. Despite these temporary gains, the yen’s downward trend continued, and it fell to a new 37-year low in early July, with the dollar approaching 162 yen. This marked the yen’s weakest level since December 1986, prompting speculation that Japanese authorities may have undertaken additional yen-buying measures to stabilize the currency.
Overall, while the massive interventions provided temporary relief, they were not enough to prevent the yen's continued depreciation, reflecting the ongoing challenges faced by Japan in managing its currency amid volatile market conditions.
According to quarterly data from Japan's Finance Ministry, this record intervention was followed by an additional 3.87 trillion yen spent two days later, marking the first official confirmation of yen-buying, dollar-selling operations for the period between April and June. These interventions, totaling 9.79 trillion yen, managed to strengthen the yen by approximately 5 percent from its lowest point of 160.24 yen per dollar. However, the interventions were ultimately insufficient to halt the yen's overall decline.
Following the initial intervention, the yen briefly recovered, with the dollar falling to about 154 yen on April 29 and further to the 153 yen range on May 1. Despite these temporary gains, the yen’s downward trend continued, and it fell to a new 37-year low in early July, with the dollar approaching 162 yen. This marked the yen’s weakest level since December 1986, prompting speculation that Japanese authorities may have undertaken additional yen-buying measures to stabilize the currency.
Overall, while the massive interventions provided temporary relief, they were not enough to prevent the yen's continued depreciation, reflecting the ongoing challenges faced by Japan in managing its currency amid volatile market conditions.
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