Special Report: Global Financial Crisis >>
The Japanese yen soared against the U.S. dollar on Thursday reaching the upper 86-yen level in a sharp appreciation not seen since 1995. As the dollar abruptly fell against other major currencies too, domestic concerns about foreign exchange volatility possibly resulting in a double-dip recession are becoming increasingly pervasive.
The Japanese yen soared against the U.S. dollar on Thursday reaching the upper 86-yen level in a sharp appreciation not seen since 1995.
The yen surged to highs of between 86.72 and 86.75 yen at one point shortly after noon on Thursday -- an all-time high since July 1995. The dollar traded between 87.19 and 87.22 yen on Thursday compared to Wednesday's 5 p.m. quotes of between 87.29 and 87.39 yen in New York and 88.35 and 88.36 yen in Tokyo.
Such is the consternation over the immediate and long-term effects of the yen-dollar exchange rate on the Japanese economy that Japanese Finance Minister Hirohisa Fujii was compelled to make a statement to the press.
"Now is an appropriate time for the country's policymakers to monitor the yen's upward trend," Fujii told reporters, alluding to there not being any immediate administrative intervention in the currency markets.
When pressed on the issue Fujii declined to elaborate saying he would not comment on the possibility of joint intervention in the foreign exchange market, and would be cautious about saying anything given the uncertainty over recent currency moves and the complications presented.
"We are currently monitoring (the yen's upward movements) and It hink now is the time to be vigilant," said Fujii.