Europe South Asia Asia Pacific Americas Middle East Africa BBC Homepage World Service Education

Front Page



UK Politics







Talking Point

In Depth

On Air

Low Graphics

Tuesday, September 14, 1999 Published at 07:58 GMT 08:58 UK

Business: The Economy

Japan intervenes on yen

The Bank of Japan's intervention spurred overnight trade

The Japanese central bank has intervened in the foreign exchange markets to buy US dollars, with the intention of putting a stop to the yen's rise.

Many had feared that the strong yen could harm the Japanese economy's fragile chances of recovery.

The yen has been strengthened by increased capital flows, as investors return to the stock market, in the belief that the economy has turned a corner. This trend is exacerbated by a belief that the US dollar will be weighed down by the US trade deficit.

When the Bank of Japan bought dollars, it boosted the currency to a high of 107.30 yen.

Minister of Finance Kiichi Miyazawa said that the government will not hesitate to intervene if the yen's rise becomes excessive. Mr Miyazawa said that the yen's rise to around 106 to the dollar earlier in the day was what they deemed excessive.

"We have no choice but to intervene if the yen rises excessively, and I think the yen's movement of late has been excessive," he said.

His view was lent support by the economic planning agency director general Taichi Sakaiya, who said the government now needs to take action to stem any further rise in the value of the yen, which will jeopardise the ongoing fragile economic recovery.

The intervention follows a split between the government and the central bank over the best way to deal with the rising yen.

The government feared that the strong yen could hurt exporters, who are instrumental in pulling the country out of recession. This contrasts with a Bank of Japan view that currency intervention is pointless and that the government's proposals could be inflationary.

Advanced options | Search tips

Back to top | BBC News Home | BBC Homepage | ©

The Economy Contents

Relevant Stories

09 Sep 99 | The Economy
Disarray over yen in Japan

09 Sep 99 | The Economy
Japan returns to growth

01 Sep 99 | The Economy
Japan ready to intervene

In this section

Inquiry into energy provider loyalty

Brown considers IMF job

Chinese imports boost US trade gap

No longer Liffe as we know it

The growing threat of internet fraud

House passes US budget

Online share dealing triples

Rate fears as sales soar

Brown's bulging war-chest

Oil reaches nine-year high

UK unemployment falls again

Trade talks deadlocked

US inflation still subdued

Insolvent firms to get breathing space

Bank considered bigger rate rise

UK pay rising 'too fast'

Utilities face tough regulation

CBI's new chief named

US stocks hit highs after rate rise

US Fed raises rates

UK inflation creeps up

Row over the national shopping basket

Military airspace to be cut

TUC warns against following US

World growth accelerates

Union merger put in doubt

Japan's tentative economic recovery

EU fraud costs millions

CBI choice 'could wreck industrial relations'

WTO hails China deal

US business eyes Chinese market

Red tape task force

Websites and widgets

Guru predicts web surge

Malaysia's economy: The Sinatra Principle

Shell secures Iranian oil deal

Irish boom draws the Welsh

China deal to boost economy

US dream scenario continues

Japan's billion dollar spending spree