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UPDATE 1-Japan finmin: yen speculation intensifies, will act firmly
February 3, 2012 / 1:10 AM / 6 years ago

UPDATE 1-Japan finmin: yen speculation intensifies, will act firmly

* Dlr/yen near record low, investors wary of intervention

* Speculation strengthening due to U.S. low rates -Azumi

* Concerned if yen moves reflecting economic fundamentals

By Tetsushi Kajimoto

TOKYO, Feb 3 (Reuters) - Japanese Finance Minister Jun Azumi turned up the heat on the currency market on Friday, saying speculative yen buying has gathered pace since last week and repeating his mantra that he was ready to act decisively to counter “one-sided” moves.

The yen crept back near record highs against the dollar after the Federal Reserve said last week it was likely to keep interest rates near zero at least until late 2014, pressuring the U.S. currency.

“I think speculative yen buying has been strengthening since last week due to lowering U.S. interest rates as a factor,” Azumi told reporters after a cabinet meeting.

“I am strongly concerned about whether the one-sided yen rise is reflecting Japan’s economic fundamentals,” he said.

“My stance has not changed. I will take decisive measures if there are speculative and one-sided moves.”

The dollar hovered around 76.16 yen on Friday, near a three-month low touched on Wednesday, keeping markets on alert for a possible intervention to curb the yen’s strength.

Analysts have said Japan may intervene if the dollar drops below 75.50 yen or if trading becomes volatile. But they also believe Tokyo is not very keen to pull the trigger, given U.S. criticism of its past solo interventions.

The dollar has been edging closer to a record low of 75.31 yen touched on Oct. 31, when Japan intervened heavily to curb yen strength.

Japanese authorities spent a record 9.09 trillion yen ($119 billion) on currency intervention in the month to Nov. 28, when the yen jumped to a record high, according to finance ministry data.

In August, Japan sold 4.5129 trillion yen in currency intervention, far exceeding the 2.125 trillion yen it sold on Sept. 15 in 2010.

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