TOKYO – Rintaro Tamaki, who was Japan’s Deputy Finance Minister for International Affairs from 2009 to 2011, reflected on past interventions in the foreign exchange market, particularly during the tumultuous period after the March 2011 earthquake and Fukushima disaster. He highlighted these interventions aimed at stabilizing markets, but also underlined the limitations of such measures in addressing fundamental economic issues.
Tamaki noted that the yen’s current weakness is partly due to interest rate differentials between Japan and the United States, as well as Japan’s deteriorating fiscal health. He acknowledged that while interventions such as selling dollars and buying yen could have a psychological impact on markets, they are unlikely to rectify underlying structural problems or provide long-term support to the yen.
Despite this, Tamaki expressed that measures designed to stop the yen’s decline could be considered acceptable. His reflections come at a time when market participants are closely monitoring Japan’s monetary policies and their effectiveness in the face of current economic challenges.
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