Dollar Tumbles vs Yen Amid Warnings of Further Intervention

The US dollar experienced a sharp decline against the yen on Monday morning after Japan and the United States conducted a coordinated market intervention last week, warning of further action to curb excessive volatility in the currency.

The dollar briefly dropped to the lower 155 yen range from its previous level at the upper 157 yen mark. By noon, it had recovered slightly to fetch 156.46-47 yen, compared to 157.33-43 yen in New York and 160.20-22 yen in Tokyo on Friday.

Japanese Finance Minister Satsuki Katayama stated that both countries 'will not hesitate to conduct a further joint intervention' if necessary. Atsushi Mimura, vice finance minister for international affairs, referred to the recent currency intervention as 'the completion of the U.S.-Japan currency alliance', suggesting a strengthened cooperation between the two nations.

Takuya Kanda, senior researcher at the Gaitame.com Research Institute, noted that intervention is merely a temporary measure, stating that a coordinated intervention can prolong its effects. Tokyo stocks plummeted in response to the surging yen, with the Nikkei index falling 1,121.51 points or 1.74 percent.