Dollar Strength Sparks Currency Intervention in Japan and South Korea

The recent fluctuations in the yen and won have led both Japan and South Korea to take decisive action against a strong dollar.

The Japanese Finance Minister Satsuki Katayama hinted at intervention, saying that Japan would 'take decisive action appropriately at any time.'

The Bank of Korea lifted its base rate by 25 bps to 2.75 percent on July 16, explicitly targeting stabilizing the won.

Currency intervention is not about winning a price war but slowing a move that threatens domestic price stability or market function.