TOKYO : Japan will likely keep intervening to prop up the yen until the risk of speculators triggering a free fall in the currency has been eliminated, said a former central bank official who was involved in Tokyo's market forays a decade ago.
Atsushi Takeuchi, who headed the Bank of Japan's foreign exchange division when Tokyo intervened back in 2010-2012, said Japan probably stepped into the market on Monday because of the sudden, big loss the yen suffered over a short spell that day. "Authorities will continue to intervene for as long as needed to ensure they accomplish their mission, which is to prevent speculative trading from causing a yen free fall," he told Reuters on Thursday.
"The whole point of Japan holding such huge foreign reserves is to prepare for cases like now, when it needs to intervene," Takeuchi said, stressing that the government did not invest in assets with low liquidity that are difficult to sell.
Source: News Formal (newsformal.com)
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