Japan sells $ 50 billion on the foreign exchange market to save the yen from collapsing

The Bank of Japan sold more than $ 30 billion last week, in its second-in-a-month intervention in support of the yen, after falling to a 32-year low against the dollar, according to traders’ estimates.

The intervention, which was conducted on Friday, came after the yen hit the 151.94 yen per dollar level, briefly pushing it up to 144.50, but closed close to 147 yen at the end of the trading week. according to the Financial Times.

During a weekend visit to Australia, Japanese Prime Minister Fumio Kishida said the government would take “appropriate measures” to address excessive volatility in the currency markets.

“We cannot tolerate excessive volatility caused by speculation,” he added, refusing to confirm whether an intervention took place on Friday and stating that “the authorities are watching foreign exchange market developments with a strong sense of urgency.”

Finance ministry officials did not comment on whether they had intervened on Friday, but two people close to the government confirmed to the newspaper that the action had taken place.

Authorities have already spent $ 20 billion in September, the first purchase of the Japanese yen since 1998, bringing the authorities’ total dollar sales to $ 50 billion in one month.

AndSince the beginning of the year, the yen has lost more than 23% of its value against the dollardue to the widening gap between the Bank of Japan’s extremely accommodative monetary policy and the tightening of most other major central banks.

The yen is seen as one of the safe haven assets in the currency market, where investors are tasked with maintaining the value of their savings in times of peril such as recession and other economic turmoil, but is now under severe pressure due to policy tightening. monetary policy in the United States, which increases the strength of the dollar against other currencies.