Japanese Finance Minister Taro Aso expressed concern about the yen's recent rapid depreciation against the dollar on Friday, saying steep currency moves are undesirable for the Japanese economy.
"It is clear that the pace of the yen's decline against the dollar in the past week has been too fast. The yen's rapid drop would increase import costs," Aso told a press conference. "Rapid currency fluctuations, whether up or down, are undesirable, as they cause various impacts on the economy. Foreign exchange rates should be determined by the market, not by intervention," Aso said.
Monetary authorities have not intervened in the currency market since November 2011. His remarks came as the yen plunged about JPY 10 to US dollar since the Bank of Japan announced additional monetary easing measures on Oct. 31. It weakened to a seven-year low of JPY 118.96 per dollar earlier this week. The yen sharply rose after Aso's comments. At 4:15 p.m. (0715 GMT), the US dollar traded at JPY 117.72-77 compared with JPY 118.15-25 in New York and JPY 118.57-59 in Tokyo at 5 p.m. Thursday.