Japanese officials convened an urgent meeting to address the depreciating yen, signaling their readiness to intervene against what they perceive as speculative and disorderly market movements. The yen, which had hit a 34-year low against the U.S. dollar, saw a rebound following statements from Masato Kanda, a top currency diplomat, indicating that no measures would be off the table to counteract erratic foreign exchange (FX) movements.
In October 2022, Japan stepped into the FX market as the yen approached lows near 152 against the dollar, reportedly spending around 9.2 trillion yen ($60.78 billion) to bolster its currency. This marked one of several interventions by Japanese authorities over the years to stabilize the yen amidst varying economic challenges.
A historical overview highlights Japan's active engagement in FX markets, from interventions in 2011 aimed at curbing yen gains post-earthquake, to collaborative efforts with the G7 in 2011 to manage yen strength. The timeline also includes Japan's interventions in the late 2000s and early 2010s to manage the yen's rise, as well as coordinated actions with other central banks in the early 2000s despite the yen's continued appreciation. The narrative dates back to the 1980s and 1990s, where Japan frequently intervened to manage the yen's value amidst significant global economic events, including the signing of the Plaza Accord in 1985 and the Louvre Accord in 1987, aimed at stabilizing currencies.
The yen's journey has been marked by various interventions, from selling yen to support its value, to collaborative efforts with global central banks to ensure economic stability. This history of interventions underscores Japan's commitment to maintaining orderly market conditions and supporting its currency amidst global economic fluctuations.
