Is Japan Ready to Take On Yen (USDJPY, 111.206 JPY) Volatility?

Japan is apparently ready to tackle volatility in its currency.

On Wednesday, Japan’s vice finance minister for international affairs Masatsugu Asakawa indicated that rising volatility in the Japanese currency yen is a concern, and that the government is willing to take necessary steps to curb excessive volatility in the currency's market value.

"Volatility is rising. Each country shares the G7/G20 view that excess volatility and disorderly moves are undesirable for the economy," Asakawa said, while adding, "We will keep close watch on market moves with a sense of urgency, while thoroughly checking to see if there's any speculative move". However, Asakawa did not seem to elaborate much on what the action would be. 

The U.S. dollar fell to a four-month low of 110 yen on Tuesday. A strong currency potentially makes the nation's exports pricier – a headwind to the global demand for the latter.

According to Asakawa, the government should facilitate the smooth passage of budget bills in parliament next year to bolster the economy while the central bank would continue with monetary easing in line with its 2 percent inflation target. He also emphasizes that Japan’s economic fundamentals are in good form.

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Sergey Savastiouk|Expert

Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.