Japan Conducts Coordinated Yen-Purchasing Intervention with US
Japan's central bank, the Bank of Japan (BoJ), conducted a coordinated yen-purchasing intervention with the US. This move was revealed by Japanese politician Katayama, who stated that the intervention involved buying up the yen. The decision to intervene in the currency market comes as the yen has depreciated against its main currency peers.
The BoJ's ultra-loose monetary policy, implemented in 2013, led to a significant depreciation of the yen. The policy, based on Quantitative and Qualitative Easing (QQE), involved printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2024, the bank lifted interest rates, effectively retreating from its ultra-loose monetary policy stance.
The intervention was likely aimed at stabilizing the value of the yen, which has been affected by a weaker economy and rising inflation. Japan's inflation rate exceeded the BoJ's 2% target, prompting concerns about price stability. The prospect of rising salaries in the country also contributed to the increase in inflation.