New tough moves in the new

The sharp gains in the Japanese yen created the impression that the authorities were intervening in the exchange rate again. The rapid appreciation of the Japanese yen on the new trading day brought the suspicion of intervention back to the agenda. The Japanese yen gained 3 percent against the dollar during low-volume hours and tested the dollar/yen level of 153. After the opening of transactions in Asia, the yen erased some of its gains and the dollar/yen exceeded the level of 156 again. Commenting on the movement, Mizuho Securities Strategist Shoki Omori said, “Japanese authorities most likely intervened, but this intervention did not break the level of 152, which investors were previously cautious about. According to Omori, the fact that the authorities could not stop the depreciation in the yen despite their intervention may result in market participants taking short positions in the yen more comfortably. Masato Kanda, an official at Japan’s finance ministry responsible for currency markets, responded, “We have nothing to say.” when asked whether the sharp move in the yen was a result of intervention.