History of Japan’s intervention in currency markets


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TOKYO – Japan on Thursday intervened in the foreign exchange market for the first time since 1998 to prop up the ailing yen after the central bank decided to maintain ultra-low interest rates that have been driving the currency lower.

It has been more than a decade since Japan intervened directly in the foreign exchange market and more than two decades since it intervened to support its currency, most recently during the 1997-1998 Asian financial crisis.

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Here is a timeline of select moves in the Bank of Japan (BOJ) FX markets.

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September 22, 2022 – The Japanese government intervened in the foreign exchange market to sell dollars against yen in a bid to stem the recent sharp decline in the Japanese currency, senior currency diplomat Masato Kanda said. The intervention followed a decision by the Bank of Japan to keep interest rates extremely low.

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September 7, 2022 – Senior government spokesman Hirokazu Matsuno has expressed concern about “rapid, unilateral” moves in the forex market after the yen weakened above 143 per dollar. He says the government would like to take “necessary steps” if such movements continue. It is the strongest in a series of such official comments made over a number of months.

June 10, 2022 – Japan’s government and central bank issue a rare joint statement, fearing they are concerned about the yen’s recent sharp losses after it weakened above 134 per dollar.

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Aug and Oct – 2011 – Japan steps in to curb gains officials fear could derail recovery from an economic slump triggered by a massive March 11, 2011 earthquake and tsunami .

March 18, 2011 – The Group of Seven (G7) nations act together to stem the yen’s strength as the currency surges to record highs in the wake of the earthquake amid speculation Japanese firms are repatriating foreign assets to help rebuild finance.

September 15, 2010 – Japan intervened in the foreign exchange market for the first time in six years, selling the yen to stem a rise in the currency after the dollar hit a 15-year low of 82.87 yen.

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March 2004 – A 15-month campaign to stem the rise of the yen comes to an end after Japan spent 35 trillion yen, or more than $300 billion, on interventions.

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May-June 2002 – The BOJ intervenes to sell yen, often supported by the US Federal Reserve and the European Central Bank (ECB). The yen continues to gain.

Sept. 2001 – The BOJ intervenes to sell yen after the 9/11 attacks in the United States. The ECB and the New York Federal Reserve both work on behalf of the BOJ.

January 1999 to April 2000 – The BOJ sold the yen at least 18 times, including once through the Federal Reserve and once through the ECB, over concerns that the currency’s strength could choke off an economic recovery. The yen continues to strengthen.

1997 – 1998 – The Asian financial crisis weakens the yen, reaching almost 148 per dollar in August 1998, even after the US authorities joined the BOJ to buy yen.

April 1994 – August 1995 – The dollar falls to a record low against the Deutschmark and a post-war low against the Yen. The United States has repeatedly intervened, often with Japanese and European central banks, to support the greenback.

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1993 – The BOJ sells the yen for much of the year to curb its strength.

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1991 – 1992 – The BOJ intervenes to support the yen by selling US dollars.

1988 – On Jan. 4, the dollar falls to 120.45 yen in Tokyo trading, then a post-World War II low. The BOJ intervenes to buy dollars and sell yen.

1987 – In February, six of the G7 countries sign the Louvre Accord, aimed at stabilizing currencies and halting the dollar’s general decline.

1985 – The Group of Five industrialized nations, predecessor of the G7, signs the Plaza Accords, agreeing that the dollar is overvalued and that they will seek to weaken it.

1973 – The Japanese monetary authorities decide to let the yen float freely against the greenback.

(Compiled by Tom Westbrook and Daniel Leussink; Edited by Bradley Perrett)

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