Yen rises against the dollar due to Bank of Japan exchange rate verification, hints at intervention

By: News Team

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The yen climbed more than 1% against the dollar on Wednesday, after the Bank of Japan conducted an exchange rate check in apparent preparation for currency intervention, with the Japanese currency gaining more impulse after the producer price data in the United States.

* In a rate check, central bank officials call traders and ask for the buying or selling price of yen. However, stepping in to support the currency would be a much bigger step.

* Japanese Finance Minister Shunichi Suzuki told reporters on Wednesday that the yen’s recent moves have been “swift and one-sided,” adding that currency intervention to buy yen was among the government’s options if such moves continued. .

* The dollar’s recent strong gains against the yen have been tied to the Federal Reserve’s aggressive stance in raising interest rates to control inflation. The dollar hit a 24-year high against the Japanese currency last week.

* The dollar lost more than 1% just after the news. The Nikkei website reported the exchange rate check, citing unnamed sources. Reuters later confirmed this with a market source. The dollar traded down 1.4% at 142.67 yen, hitting a session low of 142.6 after US producer price data.

* On Wednesday, data showed producer prices fell for the second consecutive month in August, while core producer inflation rose modestly last month.

* The dollar index , which tracks the currency against six major competitors, fell 0.3% to 109.55, a day after posting its biggest daily percentage gain since March 2020 on an unexpected rise in the dollar price index. US consumer (CPI).

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