Although the Bank of Japan has no obvious policy intervention after September 22, as the yen price falls to an important psychological barrier near 150, the market believes that the Bank of Japan and the government may have taken some "secret intervention."
, however, the secret intervention failed again.
Considering that Japan has already had experience in adopting "stealth intervention" (i.e., the government enters the market to intervene on a smaller scale. This operation is more difficult to detect than conventional intervention), some market view believes that this type of secret intervention may become one of the options commonly used by the Japanese government recently.
In addition, Japanese Prime Minister Kishida Fumio mentioned again in his speech on Tuesday that the Japanese government's tough stance on the weakening of the yen implies that the Bank of Japan may intervene again.
But on Tuesday, the yen continued to fall, approaching the 150 mark step by step.
Agricultural Credit Bank CIB Tokyo Foreign Exchange Executive Director Yuji Saito believes that:
If the US dollar rises across the symbolic 150 level against the yen, the depreciation of the yen will naturally accelerate. Japanese policymakers may want to stop the yen decline before that, or buy more time for the yen.
The yen price trend in the past few days has actually met their action conditions. They can intervene at any time between 149 and 150.
However, in the face of the continuous radical hikes of Fed and other major developed economies, the choices in front of Japanese policy makers are serious: either relax the yield curve control framework, which also means giving up the extremely loose monetary policy of ; or endure the depreciation of the yen. Some media bluntly stated that in the case where the U.S. inflation pressure may force the Fed to continue tightening the financial markets and lead to inflation-adjusted interest rate spreads that are favorable to the US dollar against the Japanese yen, Japanese policymakers really have no third option.
Japanese Finance Minister Shunichi Suzuki said on Tuesday:
Our position to deal with excessive actions has absolutely no change. We will also focus on the market today with a sense of urgency.
Market analysis believes that after the intervention on September 22, although another round of intervention by the Bank of Japan cannot be ruled out, this move is expected to alleviate the depreciation pressure of the yen in the short term, but it may not provide long-term support.
Traders speculate that the Japanese Ministry of Finance may have entered the market to intervene in foreign exchange last week. The yen fell to its lowest level since 1990 last Thursday after the U.S. released its September inflation data, but then rebounded slightly.
Previously, on September 22, the Japanese government intervened in the foreign exchange market for the first time in 24 years in the face of the Japanese yen exchange rate falling below 145.90. Affected by this news on the same day, the yen exchange rate jumped in the short term and rose by more than 500 points in the short term.
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