Japan may conduct joint yen intervention “at any time” and signal the chance of faster-than-expected interest rate hikes to stem the currency’s falls, said Tokyo’s former top currency diplomat Mitsuhiro Furusawa.
The yen is “clearly too weak” at current levels and hurting the economy by boosting import costs, Furusawa said, adding that Tokyo and Washington could step in again if the yen returns to levels hit before their joint intervention last month.
Interest Rate Hikes
Most market players believe the Bank of Japan (BOJ) will raise rates in September and Furusawa thinks it should, though what is more crucial is for the central bank to communicate the likelihood of a faster pace of rate hikes.
A nudge from U.S. Treasury Secretary Scott Bessent and a slew of hawkish BOJ communications have locked in a rate hike in September. Markets now see a 76% chance of a hike in September, according to Tokyo Tanshi data, compared with 24% on July 30.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
