Central banks are putting rates up as currencies slide against dollar but Japan and Turkey buck trend
Photograph: Kim Kyung-Hoon/ReutersPhotograph: Kim Kyung-Hoon/ReutersJapan has intervened to prop up the yen for the first time since 1998, after it hit a 24-year low as its central bank resisted the trend for higher interest rates.
The Japanese government sold US dollars after the yen slumped past the 145 mark against the dollar, on the back of the BoJ’s decision to leave its benchmark rates in negative territory, on a day when other central banks increased borrowing costs in an attempt to cool inflation.Japan’s vice-finance minister for international affairs, Masato Kanda, told reporters the government had “taken decisive action” to address the yen’s sudden fall on the foreign exchange market.
The prime minister, Fumio Kishida, said Japan would respond decisively to excessive fluctuations in the currency market. “The timing of this was very poor,” said Fawad Razaqzada, a market analyst at City Index and Forex.com. “More to the point, is the BoJ undoing the government’s attempt to shore up the yen?”
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