Japan's Finance Minister Signals "Decisive Action" as Yen Hits 39-Year Low

The Japanese yen has plunged to a 39.5-year low, prompting Finance Minister Satsuki Katayama to issue a strong warning of "decisive action." Speaking to reporters after a cabinet meeting, Katayama declared, "We will respond appropriately as needed, at any time." She emphasized that this readiness for "decisive action" was recently confirmed during an online meeting with U.S. Treasury Secretary Janet Yellen.

This "decisive action" is widely interpreted as a signal of potential currency market intervention. The U.S. and Japan had previously agreed in September to tolerate intervention aimed at countering "disorderly movements" in the currency markets, such as speculative fluctuations. However, despite Katayama's remarks, the market reaction was reportedly limited.

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We will respond appropriately as needed, at any time.

As of 11:50 AM Tokyo time, the yen was trading at 162.13-162.14 against the dollar. This follows a significant drop in New York trading the previous day. The Nikkei newspaper and TBS reported on the finance minister's statements and the market's muted response.

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This readiness for "decisive action" was recently confirmed during an online meeting with U.S. Treasury Secretary Janet Yellen.