Japan’s intervention offers little defence for yen

Despite its direct intervention in currency markets and a ¥10 trillion extension of its monetary stimulus, Japan has little hope of reversing yen appreciation.
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The yen came close to a record high on Monday, prompting Japan to intervene
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<div style="text-align: left;"> The yen came close to a record high on Monday, prompting Japan to intervene </div>

Japan intervened in currency markets yesterday and loosened monetary policy as it made a show of weakening the yen to protect exporters.

Yoshihiko Noda, the finance minister, told reporters on Thursday morning that Japan was acting alone in selling the yen, but was in communication with other countries over its decision. Later in the day, the Bank of Japan said it would expand its asset-buying programme by 10 trillion $128 billion, taking its total size to about 50 trillion.

The moves followed Switzerland’s unexpected intervention on Wednesday, when its central bank cut interest rates to zero, or as close as it could get, and committed to...

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