A Japanese intervention in currency markets would be ineffective in preventing yen rises, rendering such action both unjustified and unlikely, a former top official of the International Monetary Fund (IMF) said on Thursday.
Naoyuki Shinohara, an ex-IMF deputy chief and formerly Japan's top currency diplomat, said yen-selling intervention by Tokyo would not change a broad dollar downtrend against the Japanese currency. Dollar selling, he said, reflected wider market expectations the US Federal Reserve will tread cautiously in its interest rate cycle.
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Naoyuki Shinohara, an ex-IMF deputy chief and formerly Japan's top currency diplomat, said yen-selling intervention by Tokyo would not change a broad dollar downtrend against the Japanese currency. Dollar selling, he said, reflected wider market expectations the US Federal Reserve will tread cautiously in its interest rate cycle.
"I don't think solo (yen-selling) intervention by Japanese authorities will be effective... I would be very surprised if they act," Shinohara told Reuters. "It's hard to find any factors justifying intervention now."
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