Japan incoming finmin Fujii: forex moves not rapid
TOKYO (Reuters) - Incoming Finance Minister Hirohisa Fujii said on Wednesday that he is opposed to currency intervention as long as market moves are moderate, adding that he saw yen moves in that light.
"I don't think they are fluctuating rapidly now," Fujii, 77, told reporters in parliament, when asked about the speed of recent currency moves.
The tumbling dollar hit a seven-month low of 90.18 yen on Monday.
"I'm against intervention if their moves are gradual and we can't conduct intervention because the current foreign exchange markets won't move without a joint intervention," Fujii said.
"But I can't think other countries will conduct joint intervention even though the yen rises slightly,"
His comments drove the Japanese yen about 0.5 percent higher to around 90.50 per dollar as they reinforced expectations that Japan's new ruling Democrats would be more tolerant of a higher yen than the outgoing Liberal Democratic Party.
"Fujii has clarified that he's not in favor of intervention, and that pushed to dollar lower against the yen," said Gerrard Katz, head of foreign exchange trading at Standard Chartered in Hong Kong.
"The dollar has been a little soft and this market move could become a trend. Japan hasn't interevened in a long time, so the reality is that there's no change in policy there.
"But the markets will latch onto comments about the benefits of a strong yen."
Fujii said Japan should consider taking some steps if speculative trading causes a rapid currency swing, but added that the market was not in such a situation at the moment.
Fujii repeated his view that a strong yen has merits for Japan's economy, echoing views shared among some Democratic Party lawmakers that Japan should start thinking of a strong yen as being in its interest, a departure from the previous government's fear that a stronger yen would hurt exporters.
Japan's Yukio Hatoyama was voted in as prime minister by parliament's lower house on Wednesday, ushering in an untested government to deal with a struggling economy and the deep-seated problems of a fast-aging population.
Hatoyama's choice of Fujii to return for his second stint as finance minister has soothed concerns that the government's spending programmes will inflate an already huge public debt.
Fujii is expected to be formally announced as finance minister when Hatoyama issues his cabinet list later in the day.
(Additional reporting by Shigeo Kodama and Stanley White; Editing by Rodney Joyce)
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