Yen briefly surges to 146 against dollar after another intervention

Well Japan will not be able to intervene forever because it’s reserves of USD it can sell are limited. Sooner or later markets will go for the killing and the collapse will be inevitable. Identical with what happened with the pound attacked by Soros 30 years ago. Then the only way will be to raise rate. The BOJ and the government put themselves in a corner. Shame on them.

Intervention is just a waste of Japan's foreign currency reserves. Only has a very limited effect and then the yen will continue falling. Japan has to increase interest rates as most countries are doing.

The days of eye watering Keynesian trickle down deficit spending are perhaps soon coming to an end, even in Japan?

South Korea 2.0 financial crisis is coming to Japan very soon!

It's not that Yen is weakening. It's just moving to its appropriate place.

Japan gets top prize as the world’s foremost currency manipulator!

Well, anybody that thinks Japan is going to raise interest rates anytime soon is living in Cloud Cuckoo land, but it's not the first step (other than intervention) to keep Dollar/Yen at an acceptable level for the economy.

The first step will be at some point raising the Yield at which the 10y JGB can climb to. Currently it's capped at 0.25%...the BOJ just buys it every day to stop it going any higher. Even a signaling at the next BOJ meeting that may be allowed to trade higher would move FX significantly. Intervention is NOT manipulation and it has just been confirmed that they did indeed perform it last night, I assume through the Fed.

Yeah I agree with theResident, I guess people can talk about raising interest rates and be confused.

When central banks raise an interest rate it is a short term thing like the overnight rate in the case of the FOMC.

Japan’s BOJ is not going to raise that anytime soon.

What they should do is stop backstopping the government spending by putting an end to JGB purchases. This would see long term interest rates rise, but the degree to which would be determined by markets.

This is what undid the Truss budget full of new unfunded spending, and the fear for Japan will be a similar spike in long term interest rates in Japan. But that’d be getting back to reality, and also give reason for the yen to stopping weakening endlessly, at least for a time… with so much debt accumulated, Japan’s central planners may feel that debauching the currency is the only option.

155 by Christmas.

@theResident Raising the yield curve is exactly the same as raising interest rates.

proxy, you don’t see a big difference between the short term target rate that central banks can set as they please, and long term market rates?

Raising the former while continuing to buy long term debt to suppress those rates doesn’t make much sense to me.

@proxy. Sorry, its not.

If that were the case then please explain why the yield of the 30y JGB has moved from 0.7% to over 1.50% in a year.