Written by Leika Kihara
SAO PAULO (Reuters) – Japan's top currency diplomat, Masato Kanda, said on Wednesday that authorities were prepared to take appropriate action if there were excessive movements in currency markets.
International Finance Undersecretary Kanda told reporters on the sidelines of the G20 financial leaders meeting in Sao Paulo: “I will not comment on recent exchange rate movements.However, it is desirable for exchange rates to move stably and reflect fundamentals.'' he said. .
“We are closely monitoring foreign exchange trends with a strong sense of crisis, and are prepared to respond appropriately if we see excessively unstable movements,'' he said.
The yen has been the worst performer of the major currencies this year, as funds and others trade on the huge gap between Japanese and U.S. interest rates and bond yields, betting that this gap will continue.
So far this year, its value against the dollar has fallen 6%, falling below $150.00 to around $152.00, the lowest level since 1990.
Mr. Kanda is attending the G20 meeting on behalf of Finance Minister Shunichi Suzuki.
He said he had told the G20 that policymakers needed to be mindful of the risk of increased volatility in financial markets, including currency markets.
He also said he had told the G20 that it was important to uphold the group's commitment that excessive currency fluctuations were undesirable.
(Reporting by Leica Kihara; Editing by Lincoln Feast)
