TOKYO (Reuters) – Japanese Finance Minister Shunichi Suzuki on Tuesday reiterated the need for currencies to move in a stable manner, reflecting fundamentals, calling the yen’s recent swings “frequent,” underscoring the difficulty for authorities react to sudden currency movements.
The dollar extended its decline on Tuesday, falling to a two-month low against the Japanese currency, which until recently slid against the greenback. It is currently at 130.66 yen, having rebounded from a 24-year low above the 139 yen hit last month.
Sharp currency swings could complicate efforts by Japanese policymakers to stem a weak yen, which they say will raise the cost of living and undermine the terms of trade by widening trade deficits.
On the other hand, any sharp rebound in the yen could harm Japan’s export-driven economy, as it makes domestic shipments of cars and electronics less competitive.
“The yen was weakening but now poised to rise. The moves looked pretty bumpy to me,” Suzuki told reporters.
Suzuki told reporters he would carefully monitor the yen’s movements and their impact on the economy while coordinating with the Bank of Japan on any agreed action.
(Reporting by Tetsushi Kajimoto; Editing by Tom Hogue & Shri Navaratnam)
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