Japan sees upward pressure on yen waning
By Tetsushi Kajimoto
MEXICO CITY (Reuters) - A senior Japanese Finance Ministry official said the upward pressure on the yen was easing and he saw nothing strange in the currency's movements as it pulls away from record highs below 80 yen versus the dollar.
The official, speaking after the first day of the weekend gathering of Group of 20 finance ministers and central bankers, said the yen was not discussed at the meeting which was dominated by talks on the euro-zone sovereign debt crisis.
But the G20 did discuss volatility in currencies as well as crude oil prices, the official said, adding that these issues may be mentioned in the communique expected at the end of the meeting on Sunday.
Brent crude futures settled near a 10-month high above $125 a barrel on Friday on heightened concerns over tensions with Iran about its nuclear program.
Japanese authorities will continue to respond to excess volatility in currencies, he added, signaling readiness to intervene if speculators push up the yen too high again to deal a blow to the export-reliant economy.
"We hear opinions overall, including at deputies' meeting, that volatility exists in the foreign exchange market, so I expect (G20) may mention that volatility warants close monitoring," the official said.
"We have said that (the yen's) moves have been excessive including before and after (last year's) earthquake, which was not reflecting economic fundamentals. But I see nothing strange in the current movement," he added.
The yen, meanwhile, tumbled across the board, a downtrend that started with the Bank of Japan's recent monetary easing. Japan's trade deficit, widening interest rate differentials with the United States favoring the dollar and rising crude oil prices also have hurt the yen's prospects. Continued...