Takehiko Nakao, Japan’s top currency official said the yen’s appreciation since the collapse of Lehman Brothers Holdings Inc. almost four years ago was excessive and is hampering the economy.
Japan is suffering because of the yen’s appreciation, Nakao said in a speech at an event in London today.
“Our idea about the exchange rate is that yen is regarded as a safe haven currency today,” Nakao said at the event, hosted by the Official Monetary and Financial Institutions Forum. “But the Japanese economic condition is not so robust.”
The yen has surged against the dollar in the past five years and is hovering near last year’s high, eroding the profits of exporters including Sony Corp. and Toyota Motor Corp. A few Bank of Japan (8301) board members said in the minutes of their July meeting that the central bank should not dismiss any options in combating risks to the economy from Europe’s debt crisis.
The yen traded at 78.50 as of 9:55 a.m. in London, little changed from yesterday. It’s just 4 percent off its postwar record of 75.35, reached on Oct. 31, 2011. The Bank of Japan, on behalf of the finance ministry, sold a record 8.07 trillion yen ($100 billion) on that day to curb the currency’s appreciation. Japan hasn’t intervened in the currency market since November, according to the finance ministry.
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