Intervention after 24 years! The yen plummeted, and the Bank of Japan was finally forced to rush


2022-09-23: [Chinese Article Link]  The Central Bank of Japan finally did it! The yen at the 145th gate fell in the morning and rebounded sharply in the afternoon. According to the Japan Broadcasting Association (NHK), the Japanese Government and the Central Bank of Japan decided to intervene in the market by selling United States dollars and buying Japanese yen in order to prevent a rapid depreciation of the yen after the yen's exchange rate broke down at 145 in the morning. The Joint News Agency reported that the Bank of Japan had last made such exchange rate intervention (sale of United States dollars - purchase of yen), dating back to 17 June 1998, about 24 years and 3 months apart. The exchange rate of the yen jumped this afternoon. According to the Japan Broadcasting Association, the Japanese Vice-Minister of Finance, Shinzo Shinda, stated that in the current currency exchange, it was possible to see “quick and unilateral moves” in the context of speculative movements (i.e. the sale of Japanese yen - the purchase of United States dollars). According to domestic media reports, Tatsuo Yamasaki, the former head of Japan's foreign exchange policy, said this week that last week's exchange rate review meant that Japanese regulators were ready to act now. The Ministry of Finance of Japan is concerned about exchange rate fluctuations, and the Government of Japan will take action if the exchange rate of the United States dollar against the yen is 5 yen or even more volatile in a few days. But the market still questions the effectiveness of the intervention. Karen Reichgott Fishman, a foreign-exchange strategist in Goldman’s recent research, analyses that “the yen is likely to continue to wear off as long as the central bank of Japan maintains its yield curve control (YCC) policy, and there is a risk that the US debt will yield more. The Governor of the Central Bank of Japan, Nobiko Kuroda, and the Central Bank of Japan, Tugen. The exchange rate went down the 145th gate, and the dollar went down with the yen pressure. Prior to that, the Federal Reserve announced a third increase of 75 basis points, which had a significant impact on the yen. According to the Commons, the Central Bank of Japan, at its 22nd monetary-policy meeting, decided to maintain a large-scale monetary easing policy of “pressing interest rates to very low levels.” Today, the yen’s exchange rate fell above 145 in Tokyo’s foreign-exchange market. In the morning of 22, the yen's exchange rate broke down at 145. According to the Commons, while the rapid depreciation of the yen against the dollar will lead to higher food and energy prices and a greater burden on households, the central bank of Japan has not intervened in the depreciation of the yen by adjusting its monetary easing policy. This means that the central bank of Japan remains in the forefront of “support for economic recovery.” According to the Commons, with regard to future monetary policy, the Central Bank of Japan has indicated that it will maintain large-scale monetary easing until prices increase steadily to the target of 2%. The Central Bank of Japan has re-emphasized its approach of “relaxing, if necessary.” With the dollar upswing, the yen's exchange rate fell all the way through the year. Will Japan’s monetary easing policy be adjusted? Next April is an interesting node. Will the yen depreciate all the time? In a recent interview, Chen Yoo, a guest researcher at the Japanese Research Centre at Liaoning University, stated to the Watchers Network that the term of office of the current Governor of the Bank of Japan, Toyoshi Kuroda, would end in April 2023, meaning that at least by April next year the Bank of Japan would probably maintain its current financial easing policy. “In the light of some of the current Japanese media reports, the possibility of the next Governor of the Central Bank of Japan adjusting financial policy is, but not necessarily too high.” As the Japanese media feared before, the unique and radical increase in the dollar’s interest rate poses additional risks of uncertainty for the world economy. At the same time, Japan’s era of high-profile “exporters” and rapid economic growth is long gone. The central bank of Japan maintains a liberal policy, and the Japanese economic news screens continue to be presented in the morning by the Japanese yen sales board plus the dollar. Chen Yang stated to the Watchers Network that an interest increase in the United States dollar and a monopoly did create many uncertain risks for Japanese businesses, but that similar risks did not occur only now, but before they became apparent. “I believe that Japanese firms should have some psychological expectations and preparedness.” The depreciation of the yen, the appreciation of the dollar, would benefit mainly exporting Japanese firms, but they would have to bear the corresponding costs and risks for importing Japanese firms. According to Chen Yang, the life of ordinary Japanese will be under even greater pressure, especially for those at the bottom of society, against the backdrop of the depreciation of the yen and rising prices, and against the background of the fact that there has not been a marked increase in personal and household income. “In the short and medium term, Japanese enterprises and the general public will be under some pressure, and perhaps the days ahead will be even more difficult, but it remains to be seen whether this will be the case in the long term.” In the current wave of interest hikes, the yen, which insists on easing, is referred to as a “dove-and-hawk group”, even known as a “carry-in-the-mom”. Last week, the Japanese Economic News reported that the Japanese yen was becoming the only “negative rate currency” in the major economies, and that only Japan and Switzerland, which had shown signs of adjustment, had maintained negative interest rate policies. To some extent, that possibility has become a reality. On 22 September, local time, the Swiss Central Bank announced an interest increase of 75 basis points, raising policy interest rates from -0.25 per cent to 0.5 per cent, ending a negative interest rate policy that lasted for eight years, at a level that had risen since December 2008. This is the exclusive text of the Network of Observers and cannot be reproduced without authorization.


Note: This is a machine translated version of the Chinese news media article. A mature and nuanced reading is suggested.




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Intervention after 24 years! The yen plummeted, and the Bank of Japan was finally forced to rush


2022-09-23: [Article Link]  The Central Bank of Japan finally did it! The yen at the 145th gate fell in the morning and rebounded sharply in the afternoon. According to the Japan Broadcasting Association (NHK), the Japanese Government and the Central Bank of Japan decided to intervene in the market by selling United States dollars and buying Japanese yen in order to prevent a rapid depreciation of the yen after the yen's exchange rate broke down at 145 in the morning. The Joint News Agency reported that the Bank of Japan had last made such exchange rate intervention (sale of United States dollars - purchase of yen), dating back to 17 June 1998, about 24 years and 3 months apart. The exchange rate of the yen jumped this afternoon. According to the Japan Broadcasting Association, the Japanese Vice-Minister of Finance, Shinzo Shinda, stated that in the current currency exchange, it was possible to see “quick and unilateral moves” in the context of speculative movements (i.e. the sale of Japanese yen - the purchase of United States dollars). According to domestic media reports, Tatsuo Yamasaki, the former head of Japan's foreign exchange policy, said this week that last week's exchange rate review meant that Japanese regulators were ready to act now. The Ministry of Finance of Japan is concerned about exchange rate fluctuations, and the Government of Japan will take action if the exchange rate of the United States dollar against the yen is 5 yen or even more volatile in a few days. But the market still questions the effectiveness of the intervention. Karen Reichgott Fishman, a foreign-exchange strategist in Goldman’s recent research, analyses that “the yen is likely to continue to wear off as long as the central bank of Japan maintains its yield curve control (YCC) policy, and there is a risk that the US debt will yield more. The Governor of the Central Bank of Japan, Nobiko Kuroda, and the Central Bank of Japan, Tugen. The exchange rate went down the 145th gate, and the dollar went down with the yen pressure. Prior to that, the Federal Reserve announced a third increase of 75 basis points, which had a significant impact on the yen. According to the Commons, the Central Bank of Japan, at its 22nd monetary-policy meeting, decided to maintain a large-scale monetary easing policy of “pressing interest rates to very low levels.” Today, the yen’s exchange rate fell above 145 in Tokyo’s foreign-exchange market. In the morning of 22, the yen's exchange rate broke down at 145. According to the Commons, while the rapid depreciation of the yen against the dollar will lead to higher food and energy prices and a greater burden on households, the central bank of Japan has not intervened in the depreciation of the yen by adjusting its monetary easing policy. This means that the central bank of Japan remains in the forefront of “support for economic recovery.” According to the Commons, with regard to future monetary policy, the Central Bank of Japan has indicated that it will maintain large-scale monetary easing until prices increase steadily to the target of 2%. The Central Bank of Japan has re-emphasized its approach of “relaxing, if necessary.” With the dollar upswing, the yen's exchange rate fell all the way through the year. Will Japan’s monetary easing policy be adjusted? Next April is an interesting node. Will the yen depreciate all the time? In a recent interview, Chen Yoo, a guest researcher at the Japanese Research Centre at Liaoning University, stated to the Watchers Network that the term of office of the current Governor of the Bank of Japan, Toyoshi Kuroda, would end in April 2023, meaning that at least by April next year the Bank of Japan would probably maintain its current financial easing policy. “In the light of some of the current Japanese media reports, the possibility of the next Governor of the Central Bank of Japan adjusting financial policy is, but not necessarily too high.” As the Japanese media feared before, the unique and radical increase in the dollar’s interest rate poses additional risks of uncertainty for the world economy. At the same time, Japan’s era of high-profile “exporters” and rapid economic growth is long gone. The central bank of Japan maintains a liberal policy, and the Japanese economic news screens continue to be presented in the morning by the Japanese yen sales board plus the dollar. Chen Yang stated to the Watchers Network that an interest increase in the United States dollar and a monopoly did create many uncertain risks for Japanese businesses, but that similar risks did not occur only now, but before they became apparent. “I believe that Japanese firms should have some psychological expectations and preparedness.” The depreciation of the yen, the appreciation of the dollar, would benefit mainly exporting Japanese firms, but they would have to bear the corresponding costs and risks for importing Japanese firms. According to Chen Yang, the life of ordinary Japanese will be under even greater pressure, especially for those at the bottom of society, against the backdrop of the depreciation of the yen and rising prices, and against the background of the fact that there has not been a marked increase in personal and household income. “In the short and medium term, Japanese enterprises and the general public will be under some pressure, and perhaps the days ahead will be even more difficult, but it remains to be seen whether this will be the case in the long term.” In the current wave of interest hikes, the yen, which insists on easing, is referred to as a “dove-and-hawk group”, even known as a “carry-in-the-mom”. Last week, the Japanese Economic News reported that the Japanese yen was becoming the only “negative rate currency” in the major economies, and that only Japan and Switzerland, which had shown signs of adjustment, had maintained negative interest rate policies. To some extent, that possibility has become a reality. On 22 September, local time, the Swiss Central Bank announced an interest increase of 75 basis points, raising policy interest rates from -0.25 per cent to 0.5 per cent, ending a negative interest rate policy that lasted for eight years, at a level that had risen since December 2008. This is the exclusive text of the Network of Observers and cannot be reproduced without authorization.

Note: This is a translated version of the Chinese news media article. A mature and nuanced reading is suggested.

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