NEW YORK (Reuters) - Japan’s Ministry of Finance may consider unilateral yen-selling market interventions if speculators drive up the currency, Nikkei Business Daily reported on Tuesday.
The yen rose to a 15-year high against the U.S. dollar and a nine-year peak versus the euro on Tuesday amid fears the global economy is slowing, testing Japanese authorities’ resolve to stem the currency’s climb.
Nikkei also said in its August 25 morning edition that the Bank of Japan is considering additional steps to loosen monetary policy. Depending on market conditions, the policy board may decide to take action sooner by convening an extraordinary meeting, according to the report.
Actions could include boosting its facility that provides three-month funding at a low 0.1 percent to 30 trillion yen from the current 20 trillion yen. Extending the funding period to six months would be another option, Nikkei said.
The U.S. dollar briefly pared losses against the yen after the Nikkei report. It was last down 1.1 percent at 84.14 yen, not far from a session low of 83.61 yen, according to Reuters data.
“Going the quantitative easing route seems to be the preferred policy move from Japanese authorities should they decide to act,” said Brian Dolan, chief strategist at Forex.com in Bedminster, New Jersey.
“With U.S. yields were they are, all simple intervention will do is give speculators better levels at which to buy yen.”
The Nikkei report cautioned that the impact of unilateral intervention could be muted given that other major economies are not expected join the move.
Reporting by Wanfeng Zhou, Vivianne Rodrigues, Steven C. Johnson and Nick Olivari