Japan is ready to take action against a further surge in the yen, including market intervention, after the safe-haven Japanese currency hit a post-war record high, local media reported on Saturday. The government and the Bank of Japan have started discussions over fresh intervention to sell yen and buy dollars on the foreign exchange market, the Nikkei business daily reported. Japan is ready to intervene and sell yen even on overseas markets if it detects speculative moves to drive the currency higher, an unnamed senior finance ministry official said late Friday, according to the Yomiuri Shimbun. The mass-circulation daily also said that the central bank is separately considering further monetary easing in tandem with the government’s possible yen-selling action. The dollar slumped to 75.95 yen in intraday trade Friday, beating its previous post-World War II low of 76.25, which it reached days after the March 11 earthquake and tsunami hit Japan. Investors were flocking to the Japanese currency, seen as a safe-haven unit together with the Swiss franc, amid deepening concern over another possible global recession, traders said. Because a strong yen hurts Japanese exporters, the nation’s main economic engine, Japan stepped into the foreign exchange market earlier this month to dump yen for dollars, and Tokyo has previously signalled that it may do so again. “The government and the Bank of Japan do not hesitate to carry out market intervention… but as seen in the last case, the impact of intervention is unlikely to last long,” the Asahi Shimbun said.
