INSTANT VIEW: G7 says brisk yen moves bad for markets, economy

SINGAPORE (Reuters) - The Group of Seven big industrialized economies said on Monday that a rapid rise of the yen against other currencies was bad for both markets and the economy and that it would watch developments and cooperate accordingly.

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COMMENTARY:

YOUSUKE HOSOKAWA, SENIOR TREASURY DEPARTMENT MANAGER, CHUO

MITSUI TRUST AND BANKING, TOKYO

"It clarifies that G7 members share the same understanding: They are concerned about the yen in the current forex market and are sending a message to the market.

"It has a political meaning. Because the statement referred the yen, it signals if there is any forex intervention, the target will be the yen. But whether there will actually be intervention by the Japanese government or coordinated intervention, it is still an open question. That is the reason the forex market has not shown much reaction."

KAZUYUKI KATO, FOREIGN EXCHANGE TRADER, MIZUHO TRUST & BANKING, TOKYO

"Given the panicky and irrational movements of the yen of late, the Japanese authorities may conduct intervention independently.

"Such action may be taken if the dollar falls below the 90 yen level. But given the fact that the dollar is rising against major currencies, except for the yen, Japan is not likely to be able to win support for coordinated action."

MINORU SHIOIRI, CHIEF MANAGER OF FOREX TRADING, MITSUBISHI UFJ SECURITIES, TOKYO

"Given the fact that countries such as South Korea and Australia are even trying to protect the value of their own currencies through dollar selling operations, it may be difficult for Japan to obtain consent on joint action from the international community.

"While Japan may launch intervention alone, it is not likely to have a lasting impact on the forex market."

RYOHEI MURAMATSU, MANAGER OF GROUP TREASURY ASIA, COMMERZBANK, TOKYO

"Launching intervention independently is like a drop in the bucket, and like fighting against the whole world. Intervening alone cannot possibly reverse the current trend of the yen.

"As the bubble is bursting everywhere from the housing market and the derivatives market to emerging markets, investors are becoming more risk-averse and pouring more money into buying the yen, which is considered to be the safest currency."