TOKYO: Japan’s central bank on Wednesday (Sep 14) conducted an operation often seen as a precursor to currency intervention, local media said, as the yen continues to crater against a strengthening dollar.
The financial daily Nikkei and other local media said the Bank of Japan (BoJ) carried out a “rate check”. A Bank spokesman contacted by AFP declined to comment.
A rate check involves asking market participants about their foreign exchange trading, said Toshikazu Horiuchi of IwaiCosmo Securities.
“Basically it’s a warning, which is the next best thing to an intervention when the exchange rate is fluctuating,” he told AFP.
The yen has tumbled from around 115 per dollar in March to lower than 140 in recent weeks, as the BoJ maintains its monetary easing policies despite sometimes sharp rate hikes elsewhere, including from the Federal Reserve, to tackle inflation.
In early Tokyo trade, a dollar fetched 144.94 yen, after worse-than-expected US inflation data raised the prospect of even steeper US rate hikes to tame prices.
The rate check reports saw the yen strengthen quickly, with the dollar touching a low of 143.53 within an hour.